so who's to say that it's going to do that now i'm inclined to be in the steve grasso camp of fade it. >> when you think about it from a sector perspective, and this isn't gm specific but it's autos, it's discretionary. you've seen this massive rotation into names and sectors that didn't do so well last year so the presumption is that's going to continue going forward. my guess is you'll see a rotation out of those sectors back into tech, back into health care, even utilities if things start to really slow that's what does well in a slowing expansion phase of the economy. >> so you're going kind of defensive. >> it's a little bit of a bar bell approach. tech a little less defensive but the other sectors maybe more so. it might be unusual to think about that but that's how it tends to play out. be careful, because when it does eventually turn, tech gets hit hard. >> disney up 2% this year. trade it or fade it, grasso. >> i'll say fade this one as well this one technically is challenged as well no one is complaining about the revenues, no one is complaining about their streaming, they'r

joining us is steve grasso steve, you've had some really good predictions about the direction of the market. but let me throw a sort of broader sort of philosophical question out at you how much more can stocks rise in value if earnings are slowing and will continue as many believe to slow even if they don't fall into negative territory? >> so, this has been about really about powell. really about china powell turned on a dime. did a 180. became you know, a dove from being a hawk and now you have eps that's done nothing but drop in a precipitous fashion, yet the market is willing to pay a higher multiple for that how long can you go and the answer is not that much longer it's about china >> so china, and let's probe that a little bit more the market seems to be moving up at least in part on the idea that the trade war with china if not close to a resolution, is at a point of evolution where it may be deescalating. so there seems to be a premium in the market for that what happens then if there is some kind of a deal or if there isn't? does that premium get sweated out? >> so the prem

industrials, energy and tech are all at 20% from the christmas eve lows let's bring in steve grasso. hello, steve thank you for joining me today >> no problem. >> i wonder does this rally have you a believer, finally, steve >> new york it doesn't when you look at it, kelly, i saw the balance. it is perplexing stood here on wolf's show on the 26th of december and said i see a 10% rally. this is overextended for me. this is in no man's land we're running into resistance. china the longer it goes the more people will get sucked in on the floor and any large institutions into buying the market, but i do believe ultimately there will be a slide down, maybe not the same precipitous dropped we've seen in the basket but a slide down nonetheless to much lower levels >> is that because you're caution on the economy the valuations we saw at the bottom were very, very low for skoes. you could have gotten facebook at mid-teens valuations for a company that's growing quite fast why do you think that the rally, you know, for it would be unwarranted. >> look at the goldman sachs data they have been c

>> fade it good for tim, good for steve grasso and dan nathan who had a bullish play in a being said,y. yes, they sold it for a lot more than they nothought that they would get. but now left with a power which is that they can't figure out. so how am i going to figure it out. so great run off the low problems still exist i would fade it. >> and so i'm going to trade this which means that i will buy it it will be excite willing, co, . so progress moving faster. i realize the power business is a big issue, but they realize that it is a big issue they were cutting deals for three to five years lost losing deals. they are changing that mentality. they have an order book and now some parts look significantly better energy as sets are you saunderv. >> so what do you do like xwrat great, you've rel duced your liabilities and what are you left with. the rally is fantastic take your profit and fade it >> sneaky. >> all right dan is up next snap getting a boost on its android app launch >> i'm going to trade it investors and analysts have hated it norm you'd sally you'd say make but i think thi

. >>> the biggest retail sales drop in a decade how worried should investors are be steve grasso, a cnbc fast money trader also a cnbc contributor. welcome. peter, let me start with you, how bad was this number? and is it really explained away by two things, the slide in the stock market that was running through the fourth quarter and the government shutdown, which began in december? >> i don't think the shutdown had an effect, it was the latter part of the month. i have no doubts the stock market influenced consumer spending i'm done think the number was as bad as the print looked i think there were seasonal issues there are data points showing the consumer is reluctant to be spending january auto sales came in below 17 million delinquency rate for subprime car buyers are rising. consumer confidence for january fell to the lowest level since the month of the election. also yesterday's housing data, the mortgage bankers association, with mortgage rates falling to one-year low, purchases of homes are down 5% year-over-ye year-over-year. >> you think this is more of an enduring trend chang

. >> steve grasso. >> unh oversold, buy. >> dan. >> how about these guys, i think the gap is a sale up here. >>> guy. >> this bezos thing, he's getting them back in the nyc. >> watch out tomorrow. >> bring it on. >> you know why i found out about it other than you? i found out about it on the twitter. >> all right that does it for us. boy the way, tesla shares down 3% in the after-hours session. we'll see you back here tomorrow at 5:00 for more "fast." don't go anywhere. "mad money" starts right now >> my mission is simple, to make you money. i'm here to level the playing field for all investors. there is always a bull market somewhere, and i promise to help you find it. "mad money" starts now hey, i'm cramer. welcome to "mad money. welcome to cramerica other people want to make friends. i'm just trying to make you some money. my job is not just to entertain you, but to educate, teach you and put it in context. so call me at 1-800-743-cnbc or tweet me @jimcramer. i always say there is no room for woulda, coulda, shoulda in this business.

i would suggest maybe, and steve grasso would agree -- >> this is the key to the market this is the new gm the gm of the modern time? >> he obviously didn't give this a whole heck of a lot of thought. >> you said you just thought of it. >> i was just looking at it. i do things like that. >> we've got a top technician right here on the desk today and he says despite the day's sell-off, the rally this year still has life chris, head on over to the plaza and break it down for us >> when we look at this market, one of the big differences is the momentum surge that we've gotten off the low 93% of stocks on the s&p are currently trading above their 50-day moving average right now. that is historically very rare it tends to only happen coming off major bottoms. we got it off the '16 lows, the '11 lows, the 2009 lows. when you're coming off a low, you want overbought conditions it's a reflection of momentum. so looking out forward six-month returns, when you start to get more than 90% of stocks above their 50-day moving average, your returns six months out tend to be about 9% that's versus abou

joining our "closing bell" exchange, steve grasso and our own rick santelli is at the cme. o good afternoon to you both steve? >> yes. >> how would you characterize the trading of the week despite major events for market watchers >> i'm still negative. we have this -- such an overreaction to the downside that you have an equal overreaction to the upside so when you start to think about the way the markets have moved, they've overshot to the tune of maybe 10% so i had seen, you know, in the technicals you would see maybe a 10% move off the bottom. we have seen a 20% move. i don't think the data supports the bounce that we have seen in the overall markets. >> the big macro factors given that i haven't spoken to you for a while, like the fed's pivot, like china trade deal progress, is that priced in? or how much more do we go up >> i never think it's all priced in until you have the deal but gdp coming in as a precipitous fashion. china deal, what is that going to do for china right now? they're sitting on a ton of debt stimulus measures haven't helped what is a deal going to d