Cramer's 'Mad Money' Recap: Spot Moves Before Herd Does

How do you catch a big stock move before it happens?

By finding out about a potential strong mover before everyone else does, Jim Cramer said on Tuesday's "Mad Money" show.

"You need to be able to see stock moves coming," said Cramer, who did a prerecorded special edition on spotting tops, among other things, on his CNBC show.

How does one do that?

"You do not make money by buying well-known companies," Cramer said. "You do it by buying small-cap stocks that shouldn't be small."

Investors should be looking to get in stocks that are not covered by analysts, before the brokers can eventually get in and start pumping them up. But when everyone knows about the stock, you get off the train. Make the analysts work for you, Cramer said.

Another way to make money is to understand market psychology.

"Finding undervalued stocks is all about psychology," Cramer said. You need to know what the mob is doing, Cramer continued. If you follow the mob, you will be investing in the hot names, which are fraught with problems. "The mob crowd is fickle," Cramer said.

Cramer also outlined methods that would help investors spot tops. It's more important, Cramer said, to know when to sell than to buy.

"Why stay too long and get cooked?" Cramer mused. "[Gains] can vaporize in an instant," Cramer said.

Cramer said investors should always be on the lookout for competition. You have to follow not only your stock, but the whole industry. Competition is the chief reason Cramer has sold stocks during his career on Wall Street. What's more, always assume that competition is out there. Keep doing your homework. "Competition from left field kills you," Cramer warned.

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