We start off with all the red on wall street, stocks retreating from alltime highs as the dow drops over 800 points in its biggest oneday decline since june tech starts dropping nearly 6 , snapping a tenday win streak. Is this only the beginning guy adami, what do you think hi, mel remember the carpenters . The car ppenters are one of my o five favorite bands. Weve only just begun as ive said many times, 24 hours does not a day make. I dont want to get into the vix but i will say weve talked about it now for the better part of a week and a half despite the that the Broader Market was rallying, the vix was trying to tell you something the internals of the market havent been particularly good this gets us back to levels we saw last week. I do believe its the beginning of something but it could all reverse tomorrow on jobs numbers. Weve seen it before we come back after a long weekend to find the market up significantly. Clearly there are things to be concerned about. Grasso, what did you make of the action today i think im going to make a huge deal out of it. I this where you ae are just on precipice of a much bigger decline. I felt we could fade anywhere from 1020 . So we got about 4 today obviously we have a lot more to go i think tech is going to continue to weaken the big question is, do you see value run in the face of this selloff . Today we saw banks, airlines and a handful of other stocks able to rally early with the cruise lines and the reopening stocks but the truth is, if the market sells off 20 , its taking everything down with it. So i am positioned for the tech selloff. Im positioned for the selloff but unfortunately im positioned for the cyclical bounce. So that remains to be seen whether thats going to happen but thats the way i am positioned right now i do think we have much further to go with the selloff in terms of levels. I dont know whether that happens in two days, two hours or two weeks for many, many sessions now we have been saying this is a market thats a little bit divorced from fundamentals, moving basically on the notion that theres so much liquidity out there. Karen, you made the argument that there is no alternative for these elevating pes. But here we are today. What do you think happened and do you think that argument of there is no alternative that maybe there is an alternative at this point in time in this market run what happened today is really built on whats happened for the last few weeks, particularly the last ten days where thereally growthy ones just went absolutely para bobolic. I think this pullback is the beginning not the end. But i dont think it is the end of the bull market a day like today im going to get positions like apple and google or alphabet im definitely going to get hurt on that. Then also what do i want to own, what am i looking to buy i think were going to see more pressure i just think about also i own protection the vix is really shut up. Im not real dy to sell vix yet especially going into a long weekend. I didnt do anything to trim hedges i think there would be a lot more pain, but im also looking for things to buy, things that are not like do things like a fedex i would like to buy. I would like to buy some lowes. Id like to buy some more walma walmart. Im not throwing in the towel at all. I want to get into some of those more cyclical names and some of the value names and banks. If i didnt own banks, i probably would have started buying today but i already own them that having been said, i think theres more to go dan, do you have a Shopping List whats the question Shopping List . Well, there is an alternative and its cash. I think if you listen to jim cramer passionately on the closing bell in the prior hour, hes kind of urging some of these people who are new to the stock market who have only seen the stock market go up who have fabulous gains in some stocks that they dont even know what the companies do, to take some profits. I think that sentiment really kind of permeates through this new investor class a little bit. Thats the thing that could probably keep some of these high valuation growth stocks, the perceived winners of the pandemic, it could be the start of something as we head into the end of the year. Lets use one example. Lets use Apple Computer this company traded up 3040 from its last earnings just a little more than a month ago it went up in a Straight Line, gaining 600 billion in market cap. This is a company that has not been meaningfully growing their earnings in a couple years the stock rallied precipitously in 2019. Obviously the story about better margins, but their Services Growth is only in the teens percentage wise. But this company was trading at 40 times earnings yesterday at its highs. That just doesnt make any sense. Weve seen analysts trip over themselves to come up with all these mental gymnastics to justify it sometimes it makes sense to sell a stock. Thats what happened today in a whole host of names. If youre wondering at the start of 2019 when apple had prereleased for the first time negative earnings in adecade, you have to start saying to yourself, what the hells going on here. Listen, people have been paid to take that risk i think that the dynamic might have changed in the shortterm because i think we just had a bit of a blowout in the last two weeks. Thats an interesting point to bring up, thenotion that analysts are all over themselves in order to reestablish price targets to chase these markets higher, guy. Im wondering in terms of the psychological of the market, where that leaves us when we have a steep selloff like today and you have a string of analysts say for apple day after day after day new street high price targets. And here we have. We have wonderful analysts come on the show and there shall wonderful analysts that do amazing work that we read almost every day. With that said, my concern has been i think for some theyre getting a price target and backing into it instead of doing the work and spitting out a price target, if that makes sense. Then you have really recognizable people like tony dwyer who recently pulled his price targets. I think he feels like sort of a fools game to try to put targets on a market right now that doesnt seemingly care. I think it was Heather Bellini who made comments in terms of Goldman Sachs and zoom and said were raising our rating to neutral. I think you have a lot of people in our community scratching their heads. Dont underestimate the, again, headlines of potentially the chinese selling the u. S. Treasuries i know the treasury market is huge and were only talking about 200 billion potentially so its the drop in the bucket but the message that potentially could send might have been the straw today. The symbolic nature of that would be very important to the psychological aspect of this market just quickly because we do want to get to the chart master on the there is technical damage to this market. Karen, you have been grappling with this in terms of a fundamental market versus a Market Driven by liquidity this whole notion of analysts saying we recognize that the stock is going higher, we do like the stock on a relative basis within our coverage universe so weve got to back into that price target investors have been doing a little bit of that mental gymnastics saying ive got to be in this name isnt that sort of a little bit of what has driven you to hold your position . Yeah. Thats exactly right i often talk about how i dont like a valuation or a new price target thats based on a new multiple id much rather have higher earnings on an old multiple. But were in this new multiple thats driven by low rates or even negative rates so you can back into an extremely high market multiple. For me, i amlo long apple. I am staying long apple partially because i dont have an alternative but i feel like it got ahead of itself but im going to wait it out because i think over time that i will end up seeing money from here in apple probably not tomorrow. Thats okay, because also aside from do i have another alternative is do i sell it, take a big realized gain, pay taxes on that and then am i able to get back in at the right time and i have not a lot of confidence in my ability to top tick the market on the way out and bottom tick it on the way in if i believe in a longer term story, its not always going to fade at trade value, but i think ultimately it will be worth this value. Lets bring in the chart master carter worth to break it down i guess the big question here is has there been damage to the market has there been damage done to the tech sector in particular . Well, in many ways, yes conceptually were well past what analysts price targets are. Thats long ago and behind us. Its a function of momentum. We know that whenever you have a fever, its hard to know when it might break, but you know when you see a fever. It happens in auctions for art it happens in the local corner where people are trying to overpay for houses when theres a frenzy, theres a frenzy they dont ring bells at the top but you all referred to a lot of different chimes, one, that the vix was not confirming, the fact that tesla and apple split their stock, the fact that we were making alltime highs in the s p and only 15 of the stocks in the s p are making alltime highs. 50 of all stocks in the s p have no gains for two years. These are all bells. Lets look at some charts. The first chart is a oneyear chart of the s p 500 look at the second chart what we do know is if you do break out, move above a prior top, one Reference Point to use is the top from which you broke out. So we know that the january february peak before the pandemic hit was 3394 on the s p and the high today before this reversal 3588. If with drop back to that top thats about a 5. 5 selloff. Take a look at the next chart. Drawdowns are normal since the march low weve had three distinct givebacks there was a 7. 2 decline, a month or two later a 6. 4 and then an 8. 3. Were due for that kind of thing. The question is, is the one that starts now, does that become a much bigger one. As of now its perfectly normal. Then lets talk about tech heres a chart of the tech sector you can see a welldefined trend line the presumption is that we break trend. The final chart is the same concept as the s p one Reference Point to use is the prior high from which you broke out. Now, were the tech sector to go all the way back to its january february high, youre talking about a 20 decline. I think its important to say that, again, no one can know when a fever will break, but we know what a fever looks like we know what a frenzy is as people bid more and more its not about valuation an alternative is cash carter, thats quite a bold call at this point youre basically saying by looking at the charts, the alternative here is cash remember, its the paradox of the Investment Community it used to be that you were responsible for assets, certain amount in cash, certain about in bonds. Were so spliced and diced now, only mid cap tnt and thats my mandate so i cant hold cash that becomes a selffulfilling thing. But the concept of stewardship of capital, of course cash is an important part of that process. Carter, thank you a number of this years hottest stocks got slammed by the selloff today. Is this an opportunity to get in or perhaps theres more pain to come well get some answers in. Trade it or fade it selloff edition. We kick off things with apple falling nearly 7 . Im sure a lot of people throughout are saying maybe this is my chance what do you say, trade it or fade it . I fade it here. Youre going to have an opportunity to buy in stock probably back at that breakout level to 110 or so then get back in it depends on your time horizon. But if youre thinking about playing for a quick pop back to prior highs, i think that comes from hlower levels. Tesla down nearly 10 it had been down for a couple days prior to todays decline. Some people are wondering if they should get in here. Tesla, when they announced theyre going to do rolling dilution points, theyre going to be issuing new shares thats going to be dilutive to shareholders this is a fade so i think youre going to be able to trade this this is going to be like what dan just said for apple but its going to be on steroids. Id wait for much lower levels to jump back into tesla. Zoom a big work from home winner trade it or fade it here, karen . I would fade it it doesnt mean id short it but i cant look at this and say only if i could buy it at 380 that would be a good place and now i can. Its still just stratospheric. Fade it. Check out shares of chipotle down about 5 . Guy, trade it or fade it the logical answer is fade it im going to stay with this one. I think the environment has set up well for cmg. I dont think anything has fundamentally changed other than the market if the market sells off in a meaningful way north of 70 of stocks are going to follow i happen to think cmg might be the one that doesnt so i would stay in the trade. Docusign is one of the other work from home stocks that were hit really hard in todays session. Lets get to deirdre bosa. Were having trouble with deirdres mic. 45 Revenue Growth here for docusign the stock is down by 3. 2 here in the extended hours. It moves in tandem with a name like a zoom which is seen as a beneficiary of all the same sorts of trends. Karen . Its a great product. The valuation is too high. I thought their earnings looked really great i thought the guidance was good. There was a lot to like except for where the stock is a valuation. Even down a little bit, i wouldnt be a buyer here. Initially it did look like it couldnt bounce because we did have a trade higher in the after hours session initially at least until it fell down by 3. 6 now. Yeah. What did we play the other day i should know the nomo part the reason why i thought this was particularly dangerous is the stock went from 200 to 290 in a Straight Line basically now here we are 235 or so. I think theres an entry level to buy it. My sense is you buy it back where it broke out from, which is 195 the story isnt broke. Its just the stock got ahead of itself. Coming up, chips getting checked in a big way today and later, todays market volatility may have you running for cover, but how much longer may the pain go on well search for any light at the end of the tunnel. As business moves forward, were all changing the way things get done. Like how we redefine collaboration. How we come up with new ways to serve our customers. And deliver our products. But no matter how things change, one thing never will. You can rely on the people and the network of at t. To help keep your business connected. You can go your own way go your own way your wireless. Your rules. Only Xfinity Mobile lets you choose shared data, unlimited or a mix of each. And switch anytime so you only pay for the data you need. Switch and save 400 a year on your wireless bill. Plus, get 400 off when you buy the new Samsung Galaxy note20 ultra 5g. Welcome back to fast money. The semiconductor getting crushed in todays selloff there could be a lot more than meets the eye to todays smackdown. Some investors clearly deciding it was time to sell some chips the etf that tracked the sector finished deep in the red today its had its worst day since june 11th. Some of the hardest hit names nvidia and amd at least some of the selloff could be traced to a company that supplies optical equipment to the big carriers. Its the worst day since 2008 for that name. Was that an outlier or the start of something bigger . The smh still up about 80 since march lows the valuation after such strong runs and the election. Bloomberg reporting that china is planning what it calls a sweeping set of new Government Policies to develop its own domestic chip industry one final data point for chip investors to think about, broad co comm this wasnt one of these high flyers amd was up about 80 year to date or nvidia up now after a little bit of a selloff, up 120 year to date those two, the latter two are the sexier names in the chip space. I think you could have much more room to the downside on all of these names. But when i look at the value play, thats intel intel you should get a yield from so you could see people that got run over in intel actually dip a toe in these selloff in these growthy names. But youve got to believe that ultimately your yield is not going to be outweighed by the decline in the actual share price. I guess the question here is, you know, for chip stocks in particular, they are at the Cross Section of growthy technology, but then also the ultimate cyclical play what do you think the forecast is for the chip sector in a market that might be hitting some speed bumps speed bumps, yeah karen addressed that yield point that you get wiped out in a day last night during the 6 00 special. I do Pay Attention its clear that the world has changed and its set up perfectly for what all these companies are doing. You have to ask yourself, nvidia now is a 330 billion or so company. In my opinion, companies of that magnitude shouldnt move 10 in one day. This has happened a couple days. Its problematic it speaks to a bigger problem with the Broader Market. Were obviously having some problems with guys shot dan, i dont know if youre able to continue his thought or if youve got your own. So youre talking about the smh here 13 of the smh is taiwan semiconductor. 23 customer is apple. Today while apple closed low, taiwans semiconductor closed 3. 5 off of its lows can you imagine if that stock had closed down 5 or 6 or so . We would have seen a blood bath in the smh it was interesting to see some relative strength in the largest member of the smh. You have the growth, you have the cyclicality. I think this is a group that obviously signalled the bottom back in march at least as far as tech was concerned but it might also be the one that pulls back and kind of stays back, because some of those large components got very expensive, very ahead of themselves i like taiwan semi that could be a good tell for this group looking for a bright spot in todays sea of red well tell you what Unlikely Group was able to eke out some significant gains today. Plus, if youve got questions about how to navigate todays turbulent market, were here to lp tweet us cnbcfastmoney. I really need to start adding less to cart and more to savings. Sitting on this couch so long made me want to make some changes. Starting with this couch. Yeah, i need a house with a different view. And this is the bank that will help you do it all. Because at u. S. Bank, our people are dedicated to turning your new inspiration into your