i think this could be a quarter where the worst of the bad news is shaken out, and i think there could be opportunity further into the third quarter and toward the end of the year. >> i guess that would fit with a lot of historical patterns. don't be surprised if we are still volatile through the late summer and into the fall, but maybe some relief after the midterms. lindsay great to speak with you and happy fourth, thank you for coming out. that doesn't for overtime and fast money begins right now. kicking off the new month and the new quarter, the s&p rose more than 1% but one trader said there is another chart that could be telling the true tale and what it says about the markets direction. the mj cannabis drop nearly 10% and has the tray gone off in smoke for good? plus the biggest drop in over two years. the chairwoman makes a special

appearance to tell her what has got her even angrier. this is fast money live from the nasdaq market. cofounder of market rebellion.com, we start off with the most important chart in the market according to one of our traders. over the last five days bond prices have rallied with the yield on the 10 year dropping below 2.8% for the first time in over a month. the s&h semi conductor has plunged, down 9%, far outpacing the losses that we saw in the broader market. so we pointed the sma is important all the time and the declines, they was just resting this week. >> yes they was, and if i look at yields on a basis going back relative to november 2018, to the highs of june, the 50%

retracement for yields is 2%. the reason why i bring it up is those two dates, it looks like to me a double top for yields. i think we're going to get a respite as we have seen gasoline prices come in and commodity prices come in on a monthly basis and not as a whole. i don't think we are out of the hole yet. i think will give enough to j powell to maybe take his foot off the gas and you will see the yields come in from here. >> you are the one who brought us this important chart of the week and what does it signify to you? >> i think it is a broken record in terms of the importance of semi conductors because of their epicenter dynamic and in terms of supply chain and inventory dynamics and under ordering and over ordering. look at the underperformance of

the smh. 4.5%, almost 5% to the s&p today. a decent start to the quarter today. if i look at semi conductors the underperformance to the s&p in the last 20 days is about 13% . this is to a s&p that is been down aggressively. this is how much he semi conductors have underperformed, in stark contrast to the rally in bonds. safe in the recessionary risk, facing it head on, as reference with the tenure going from 350 and we are at 280 on below. the bonds rallied back a bit in terms of yields. it was really an ugly day and we pointed out this week and i think we will continue to point out, it may be okay to see the interest rates and stocks rally, and they will carry the market.

what i saw today was pretty ugly, and i think the move in the semi conductors is downright scary because i talks about the real epicenter of the economy. >> the moose was defensive in this rally. we saw the biggest gains and utilities and the rally in the bond market courtney. what you make of all this in light of the semi conductors signaling the latest data point from micron. they just talk to investors in early june as a things are worst today than they was at the first of the quarter. >> i think you are seeing this across multiple platforms. urc consumer spending coming down, and tim brought up a good point, that semi conductors are leading to the idea that the economy is falling down. good news for the economy and bad news for the stock market.

instead hopefully he's on the rate hike, which inevitably is good news for the market. i think there's a lot of good news and bad news scenarios. >> do we get a respite in terms of selling particularly in tech names because of this pullback in yields? >> the very first thing that i look at each and every day is the yield and i look at the 10 year and the two year, and if i see them, as it dropped underneath three, i want to see what kind of acceleration we have on the drop and if it transfers to the market pretty quickly. for the last three hours of the date that is when we had all of the gangs that we was looking at. the dow jones was up 300 points in the last three hours. over 160 points on the nasdaq. real quick on the semi conductors, this is been going on for a month.

the one week has been awful, and they have been really struggling for a while. with the micron news today and some of what was forecasted, and i think tim is 100% right on this and i continue to look at this. we have seen by across the board, not just in the individual names but on top of the individual names. they are not just going short term. most of them have been moving out in time all the way out as far as september and october. it is itching to see what we are seeing in the options market and how that is playing out in the markets themselves. i still do need to point out that seven or eight of the biggest sectors actually finished up 1% or more today. it was a pretty broad base move to the upside. i realized the text really did struggle but everyone and everything else is off to the races. >> to the point by pete a

negative on semi conductors, i have been negative for a while. only micron is below the february 2020 level. i will give you a point of reference. if nvidia gets down to the 2020 level it would have to be cut in half . we are talking about a 50% move down. the smh, and the two to talk names, taiwan semi conductors and nvidia account for 20% of that index. so the psm is not as bad but it would have to be chopped up maybe 30% to get down to the february 2020 level. this is a matter of wanting to see the pull forward of the semi conductor names. there is a lot of room to the downsize, and we will have to get down. we didn't even talk about the ism levels. we are looking at june 2020 levels and may 2020 levels for ism.

the s&p was at those levels and if we push them back you are looking at between 2800 and 3100 in the s&p. overall we have to chop a lot of wood before we are at bottom. >> i have a question about the baseline. one is a baseline have to be pre-pandemic? why february of 2020? >> i will give you just a small snippet. we within an environment at the point where we was not in a rising rate environment. we had a huge bell went to the overall market, a huge pull forward for semi conductors, across-the-board. but you have to go back because we are in a rising rate environment and everything is calculated by the cash flow, and that is why technology stocks will run with the rates

are low and not in a rising rate environment. >> that's depressing because that is lot of woodshop on the s&p 500. >> paul bunyan here, and i think part of the 2020 dynamic is, you talk about companies on a two-month three-year stack, and we get back to february 2019 and you are looking at companies with normalized earnings at that point. i would make an argument that we are in a period of stagnation, coming off the period where the fed overstepped and tried to race race in december 2018. we know where we was on christmas eve when the stock market went down 20%. the rally from september, october and november of 2019 into that 2020 level was pretty extraordinary.

i would make an argument and that is when you get into paul bunyan territory, that it is not the right level to look at. it was zero inflation. should equities be valued in the same context as that moment in time? >> should that baseline actually be lower? >> yes. >> let's get to a sunnier topic and the underperformers and today's market. a depressing show today. the social media giant dropped 12% after mark zuckerberg warrant that they will cut back on hiring plans to prepare for one of the worst downturns they have seen in recent history. the added in an internal memo circular yesterday that the headwinds are fierce. they should not expect vast influxes of new engineers and budgets. that doesn't sound good but maybe the most conservative thing to do if you believe the

economy is back flowing. >> i don't think this is extremely surprising right now. they already had a hiring freeze previously. i think it is kind of interesting as tech in general has been so overrun and really selling off and interest rates are rising. we are seeing some of the valuation come to a point where it might be worth some sort of opportunity. yes this is not good news, for facebook, but maybe as a long- term buyer you have an opportunity. >> i don't know if you are in the depressing paul bunyan recession camp, you might not like a meta unless you think all of the decline in gdp and add revenue. >> i will not say all but probably much of it has been priced in and zuckerberg is trying to get things shifted

around and moving around and said some of the employees may have to just leave, some of the words that he used when he was describing how he feels about what is going on in the company is pretty interesting. there is a lot of different things going on right now, and they still want to spend money. but it is a matter of how can they do that under the circumstances they have right now. and is meta the right way to go. it is because they says it is and they will continue to build on that. but i don't see a lot of hiring and what i think he is trying to get going is to get people to make some moves to other places and move out of where they are right now and give them more freedom to spread around their money. >> job cuts, particularly white- collar job cuts in the likes of a meta and tesla and netflix. do you think it is negative or actually good because the

companies are girding for tough times ahead? >> nothing like a crisis to make a company more efficient. i think there was a sense in the tech world that growth would be forever and money was free, and we are being paid to invest as much as we can and i think there has been a reassessment. they are actually worse than the public markets because they can't fund themselves the way that they could. obviously the tech world has been the backbone of a lot of take funding over the last 10 years. i think it is making the job of the fed easier, and i won't get back to paul bunyan but i will just say what i looked at yields this week and looked at semi conductors, is the fed going to break something? it felt like the fed breaking something on a day when the market was quiet and higher. pretty ugly stuff in terms of

what the bond market has done in the last three days. the economy and companies will have to cut jobs and that is part of the story. spec of next kohls if you can goodbye to the idea of taking private and what the company has to do now? will take a look if new highs are coming. fast money will be right back. w. these are the bonds worth investing in. for over 50 years, pimco has reinvented fixed income to create opportunities for investors in every market environment. so, no matter what happens you can build the bonds that mean the most to you. pimco, a global leader in active fixed income.

>> welcome back too fast money. the shares of kohls was down nearly 20% after they called and said the microenvironment has gotten worse. the company cut its sales forecast for the current quarter. we are joint from the past line to break it down. karen i know that you are mad. there is a lot of things to be mad about. the filings show the company have been lying this whole time to investors. >> the 8k filing, i don't even know where to begin. it is so self-serving when they got these bids and they was engaged in the process which i find is impossible to believe. they had the self serving statements and said things like

we cannot generate any more value than what management is doing which is absurd. the bidders that i am not interested in retail. that was sort of odd. the destruction of value over time beginning in january when they received a proposal, and then presented their brilliant management plan that shareholders hated. that they basically lied to the shareholders, and they led to believe that the team was still together, and chief marketing officers, when in fact they was leaving and they should have told shareholders that before they voted on whether not they wanted to have management's plan or wanted to sell the company. to be fair to them, we know that they lowered their own revenue and guidance, but that

they had ugly call about how great things was going. then today they kind of sneak in another revenue miss that is lower, underneath the self serving for lack from how great the process was of them looking for a buyer. they have wasted and destroyed so much shareholder value in five months, and it is not our fault retail is really bad. it is way higher than what they was able to deliver. they underperformed every other retailer, and they shocked the shareholders and said i am a orphan and we have no shareholders and we are happy with the now. >> you are just about out of time, but it sounds like you a very convinced that management has been incompetent if not

truthful and lying to shareholders. what do you do with your holdings. >> i had stocks, and i sold some earlier, and those will go to zero and i don't need to worry about what to do with those. it should be really cheap, and it is a small position now. i would not be surprised if it comes back but it will not be easy to do before next year. i don't know, maybe zero maybe a little, i don't know. >> try and enjoy the long weekend karen. >> thank you, i will. >> it sounds like tim, you know what, done. >> i wiped my hands clean.

i would also point out that department stores have had a terrible run here overall. i kind of like the fundamentals there, down almost 30% in a month and playing it 4.5 times next year's numbers. the bottom of story, the m&a and the big story to kohls and detailing where the management has gone wrong is something unique. i think retail is the broader story. this was a company that was under a lot of pressure before, and i think we even heard this earlier in the week that this is a tough place for department stores and malls. >> the two discounters benefit when you have oversupply. one last thing on the kohls store, the 20 level , and if you don't think that is enough

damage to that april 2020 level. >> up next we are lining up our chart of the week and are looking to trade. the traders break down the old and new energy that you might want to add to your pofortlio. also a look inside of the works surrounding the rise and fall of some of the most high point coming your way at the top of the hour. stay tuned. a fund that gives me access to the nasdaq-100 innovations, like real time cgi. okay... yeah... oh. don't worry i got it! become an agent of innovation with invesco qqq researchers believe the first person to live to 150 has already been born. it could be you! wow. really? of course, you'll have to eat your greens, watch your stress, wear sunscreen...

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>> welcome back to fast money. take a look at our chart of the week. it is down more than 9% over the past five sessions and even

with the come back today, light low generation and cannabis, among the winners to close out the week. so tm, what does it mean at this point? >> this week has been tickly tough and this was a week when the canopy growth, one of the largest in the space, largest in canada and they was issuing equity to take out a unsecured note, and a very diluted exercise, and something at one point they was the darlings in the space and accompany back by constellation brands, and is a company that has been eroding capital quickly. that was a story this week and i think the story across canada is similar. a lot of consolidation that needs to happen and the top 3-4 players there are losing market share. you want to be mostly vested in the u.s. market, and if you look at the u.s. mso, and these

are companies that are trading at there may 2020 covid clothes, and actually trading cheaper than that. i am not saying it is pound the table time, but the cannabis sector has been re-price. valuations in the u.s. are very interesting here. >> is it time for the space are given the market conditions just not in your view? >> i think it is not about the market conditions but the problem i have is it is very much like uber and lyft, make some money because you have to be profitable. so many companies out there and they are all working hard. but they have to make money. >> all right.

let's go around the horn and what do you say? >> barbecue time with some riser -- budweiser. >> the solar looks terrible on the technical level. >> peat. >> i think it has bottomed out and ready to rock it to the upside. >> one think that i don't want to mop barbecue is beyond me (vo) some bonds last a lifetime. >> that doesn't for us on fast money and don't go anywhere because options action is up next. rth investing in. for over 50 years, pimco has reinvented fixed income to create opportunities for investors in every market environment. so, no matter what happens you can build the bonds that mean the most to you. pimco, a global leader in active fixed income.

>> right now on options action the chart trifecta that is penny a gloomy picture for the economy and potentially the markets in the second half of the year. plus the energy trade we will drill into it a little bit. check out renewing a bet on renewables. later searching for answers on google and where it goes next. this is options action.