you want to watch to see if the nasdaq has come down enough. also, yields very much repricing for an imminent fed rate hike. two-year yield was the only one not you have today that maybe means we're rethinking -- >> i took up your time, mike, sorry. we're out of time, "fast money" starts right now 42 bathrooms, that's a lot of scrubbing bubbles tonight on fast we're on the verge of earnings season kicking off. find out which names they are betting on heading into next week plus the chips get checked, the semis pulling back after finishing off last year at record highs, so where is this trade head headed from here? the chart master will lay it out. troubled brewing for starbucks it's not just the falling stock price that has one of our traders jittery today.

we will explain. i'm in tonight for melissa lee tim seymour, steve grasso, who lost the woodsy plaid shirt from yesterday, now wearing white nadine turner, welcome, and pete najarian lady and gentlemen, thanks very much we start with our chart of the week that would be none other than the ten-year yield breaking out in a big way to start the year, up a quarter of a percentage points, in just the past five days, touching its highest level in roughly two years that's the rising star are we headed to 2% or back down to 1.5%? tim, what do you think >> first off, tyler, i just had one of my new year's wishes come true, that tyler at least host

once in 2022. >> it's been a while. >> it's too long maybe they'll tag you for the new year's show again. who knows? let's get back to the ten-year, we're through the march highs, there's a sense that some of this is really about new fed guidance, a bit more than we got from the fed minutes on wednesday. without getting to wonky on the show, because we try to keep it relatively straightforward real yields have fallen about 25 basis points, which is some sense that people think the fed could run off the balance sheet a bit faster the most pour things for equities here, is we continued the call it dot-com 2.0 crash, i think it's well below the surface, but not necessarily considered to be the top four, five nasdaq plays. the resources trade and

reflation trade, the energy trade, they sectors look a lot like back in march in some sense they're below those levels when you say real yields have actually fallen, explain that to the viewer who has to think twice, a i do, what you're talking about. >> i'm sorry i did that. it means they're less negative we are effectively with the inflation rate, which we know isn't accurately reflected, you have a case where you've actually seen real yields come up 25, 30 basis points all that means is there's a sense that the fed will move faster in bringing down the balance sheet. that's important for a lot of different asset classes. >> nadine, take me across the landscape from equities and high-growth tech stocks all the way into real estate, if you will >> sure, tyler

we think it's just a lot of technical selling. i think jpmorgan puts it at 90% of trades are done by computer it's not to say somebody who is out there that loves a tech company that didn't do well. it's all for fundamental reasons. rates are up and people who think that tech has long-terms earnings, they do a discount analysis if the denominator is getting bigger in that, it means the overall ratio is going down. therefore, they crush the multiples and the stock goes down, but these are all bond-like things, so tech is trading like a bond, obviously fixed income you've got, and other different sectors. real estate, utilities, staples, telecom, health care, they all tend to trade bond-like. they were hurt this week when other sectors like financials

and obviously -- do well on that type of trade. under the surface, certainly sectors did fine, others got hurt, but the overall question to tim is we think the growth in gdp will be decelerating this year, so i would say by the middle or end of this year, i don't think you'll see rates i think the fed is saying we're going to have to bring this down a bit. expectations will come down. >> how about you, steve? what do you think -- when i look at rising interest rates, i think on the one hand it's kind of not the best news for stocks, but obvious they 'company a fairly fast-growing economy. we have wage growth, a low unemployment rate, and an awful lot of people saying 2022 looks fairly good, though acknowledging what nadine says, this is not going to be as fast a growth year as 2021 was.

>> i agree with nadine what you just touched on, tyler is the crux of our issues -- are rates rising for the right reasons? are they rising because the economy is doing better? they're mostly rising because of inflation due to supply chain issues for me that's not the right reason i agree with nadine. i think as the supply chain issues ease a bit, you're going to be chairman powell get off the gas a little bit, so to speak. why is he going to do that because he didn't want to be responsible for killing the economy. i understand the market is at all-time highs, but people judge the economy on where the stock market is currently. so even though the economy can hand 2%, 2.5%, 3% in a ten-year, i don't think we'll get there. i think more of this is just positioning by traders versus actual real yields so to tim's point, when you look

at the nominal yield, you factor out inflation, you're not looking at anything grotesque to the up side, but there's a lot of industries, mainly growth, that we've seen in the last couple days, the tech space will continue to be obliterated if yields rise. >> let me make sure i'm understanding you correctly here you think that the fed chair, whose hearing i think comes up next week on his reappointment, you think he and the fed will avoid a major mistake policywise by keeping rates moving up fast. you think they'll avoid that >> i think that the market is just -- the market was just absorbing the fact that tightening versus asset purchases. now, when we throw in the balance sheet, i think that was alte a little too much, even if their minds, to effect on the

marketplace. i think investors will use their vote by selling stocks i don't think the federal -- fed chairman will want to do that. obviously for political reasons and the fact that he doesn't want to oversee a 20% decline in the stock market, regardless of whether he's supposed to be a political organization or not, he watches cnbc. >> pete, wrap it all up in a bow for us what do you think? >> i think the real story line behind all of that, quite honestly, is the velocity of this move. i know we've been talking about this moves in rates, especially just this week alone, it's pretty incredible. we have seen it move around a bit, tyler, but i think the most recent move we've watched specifically caught a lot of people probably off-guard, because they assumed we would be in the same trading range. suddenly from 1.5 to almost 1.8

in a hurry that's an incredible move. with that move we were seeing an unbelievable amount of option paper playing to the up side in a lot of the areas that tim and nadine were talking about, some of the material space as well. obviously energy has been incredibly strong as well. if you look at the price of crude and how rapidly that's moved from the upper 60s toward 80 then you look at the ten-year from 1.5 up to 1.8, we're talking about a lot of rapid moves to the up side that i thinkare catching people off-guard. i see the volumes that are incredible, tyler, buying more and more and more. it would be interesting, with the financials, because that's always big, that's always something that's very important. and i think that will be something to watch very, very closely. do they actually live up to what

everybody is looking for >> financials doing well. one area that is not doing well are semis. they got smacked down. the smh down nearly 4% this year that means five days this year, but the chart master sees big opportunity when the chips are down carter, talk us through it tyler, how are you >> i'm great. >> so it's an interesting thing. there's a big debate whether you abandon growth stock, embrace cyclicals. that's all always a debate that goes on. let's look at a couple charts. i think semis will do well first is a long-term chart it's not looking at the stocks' index, but the relative performance of the stocks to the s&p. you see that circle. that's the dot-com peak.

whereas this has taken ten years, and we're still not back there, which is to sake our semis will they ultimately make a new high for the s&p i think so for those who carry about valuation? i think that's a good deal next chart the smh, the van eck that catches -- so next that is right, this is the smh, that is a mathematically perfect 45-degree. that's the past year and a half, 18 months, we're simply to the mid point of the channel could we go to the bottom? okay, but the point is, this is up and to the right, and it's just rested for the better part of eight, nine, ten weeks. that's a good thing, not a bad thing. final chart, this is a ratio chart again.

this is -- we just broke out to new highs. this is the relative performance of the smh to the qqq. i think that's very important. stocks up 41% last ear, almost double the s&p they, for the first time in the history of the philadelphia semiconnector index, outperform the s&p for thee years in a row. do they do it again? my hunch is yes. nadine, what do you think? there's a pretty compelling argument, as you see them beating the qqqs >> tyler, i agree with carter there. number one, you have the secular growth story number two, this week, like i mentioned, was more of a trading algorithm repositioning decline in tech and semis versus a fundamental story. no one is say semis are broke. it's more of a trading, rates play, repositioning, so there's

opportunities here i agree on the smh the pride is about 296.89. a top end of 316.25, so minus 0.2% down side, on that's right there to be able to buy. i think you're going to start getting more to fundamental trading stories, in fact, this week i bought a bit of taiwan semi. >> even i can do the math that you described. even i can do the math folks, we're going to take a quick break. earnings season kicking off next week how should position your she had ahead? later, starbucks shares cooling off this week. what's behind this venti-sized move lower much more fast in two. at fidelity, your dedicated advisor will work with you on a comprehensive wealth plan across your full financial picture.

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welcome back earnings season back in session next week. we thought this would be the perfect time to play a little

game of -- >> trade it or fade it >> yes, indeedy. it's "trade it or fade it" earnings edition tilray, pete, you go first -- trade or fade this name and why? >> unfortunately i have to fade it i notice i'll get a lot of pushback, but look at the stock's performance they still, for as long as they have been around, when will they make money? that's the frustration i've had with a lot of different companies. the selling in nasdaq names are the names that just don't have the ability to make enough money. i think the cash burn is part of the issue great company. we all loved it at certain times, but unfortunately i think its times are also in the past i think it will go lower.

>> tim, you have the other side, but down 43% over the past 12 months. >> yeah, i'm going to definitely trade this one full disclosure, i own this in a core position of my etf, also a pick of mine in the stock draft. >> i remember. >> i'm sure you do i would respectfully disagree with pete on the cash purpose. canada is not the exciting market in cannabis, it's the u.s. market, but they're the best operator in canada. their global business is probably the best of any of the folks out there. i think they understand brands irwin simon certainly does, as a ceo in a sector that's about cpg, i like it there's a lot of issues in canada, and that's kind of the point. i think this is a great entry point. wells fargo now, a company moving big time into money management nadine, trade it or fade it?

>> this one i'll trade it. you look at some of the things we have to have for this names recent rise in the ten-year, check. rate hikes later, check. loan growth probably going up, check. so you have a lot of things in their favor. they're also going to probably lay out the steps to get to peer efficiency ratios and reduce their expenses i think they'll talk a game this quarter. i would hold it, but for those looking for a great entry price, i would look closer to 47.85 this is not the time to enter, but i think you can hold it into 9 print. >> steve, what do you think here >> i think nadine made the case to fade it i'm a fader of it. basically we're on the same page all those checks we had, kind of got the good news out of the

way. this is a stock for all the reason with a headline risk. now the one-year performance is up jpmorgan is up, berkshire is up. so there's a lot of stuff that's already in, so the risk/reward, i would agree with nadine, it's a fade delta is on the runway, tim. what are we going to do? >> i'm going to trade it flying high. i think the premium brand in airlines i think they're more focused on premium. i think to the extent that this is the best balance sheet, i think this is a company that did not have to dilute effectively the equity base during covid i recognize there's been some headwinds around omicron, but ultimately delta, in terms of their capacity, as we look for efficiency out of the airlines, that's ultimately what had been driving a rerating back in 2016 through '18. i think delta is in the best

position to be as conservative on capacity while their costs have been most sideways. airlines are moving higher i think the trade is still there. >> nadine, cleared for takeoff, or send it back to the gate? >> i think it's going back to the gate i think everybody is recommending delta that's when i want to take the opposite side of the trade virtual classrooms are pushing out demand recovery for leisure and corporate. if you have to buy the name, because you have to stay with a benchmark go closer to 38.92. cramer's got the setup for one big bank reporting next week check it out in today's investing club newsletter. starbucks is up next what gives the coffee talk that's next.

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activating "piggy power." shares of starbucks losing steam based on two downgrades. analysts pointing to risings costs. tim, you flagged this move what is the sttrade on starbucks they don't seem to be as fullsomely stacked as previously. >> i've been an investor for years. i've been a diehard consumer i will wait longer, but the wait has become too long, and i've got to tell you, you've got getting watery coffee. i go there for the robust burnt-tasting coffee i'm not getting it

the biggest issue here, look,s company on the gross margin, they ticked down a bit in '21. they've been able to offset by higher prices. i don't think they can do that it's getting to a place where their pricing power may be called into question they brought that gentle uptrend. the stock has been largely dead money, but 107, you know, it looks like it's kind of in no person's land. i worry about the stock. the valuation is not terrible, but it's not cheap, and i do think that the stock has to deal with public perception the service issue? starbucks has been hurt by omicron. >> pete, what do you say here, are you a fan? >> no. as a matter of fact, i totally great with tim you're looking at a mid 30s forward p.e., that seems steep to me. and labor, labor is an issue for

so many right now. it's been a problem throughout the pandemic, but it continues to be a prop it's hurting the franchise, hurting all of that whiff built up it's just not the same because of that, i totally agree with tim's points on what he was saying in terms of what it looks like right now i think they will be able to fix this, but it's going to take a while. the labor shortage is still here in front of us so for right now, i think it's better to be on the sideline. >> two thumbs down on starbucks. let's go to our final trades na nadine, you get to go first. >> i'm going to stick with my yesterday. gold is still the etf, i see it being a good place for this year, buy it at 166 or below >> draftkings, it's had a brutal

run, back in draftkings. >> how about you, pete >> i'm going to love it this year, two. >> off to a great start up how about you, steve >> brother pete almost talked me out of this final trade. tilray, a very expensive option. >> thanks very much, folks that does it for us on "fast money. don't go anywhere. we're going to stay right here with you, as "options action" picks up next. okay, imagine thi. your mover, rob, he's on the scene and needs a plan with a mobile hotspot. we cut to downtown, your sales rep lisa has to send some files, like asap! so basically i can pick the right plan for each employee. yeah i should've just led with that. with at&t business. you can pick the best plan for each employee and get the best deals on every smart phone.

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it's friday, and it's time for options action the first options action of the new year, and here's what's coming up. >> tonight, as covid continues, an inverse trade pitting two consumer-driven sectors against each other, but not in the way you're probably expecting. carter worth and mike khouw ck