Chip Foundries Forging a Tech Rally

Bears all over me this morning on my tech thesis. Bears in the rearview mirror, bears clawing on the windows, knocking down the doors: "Jim, if tech's back, why aren't the semiconductor-equipment stocks moving? Huh? Huh?"

Oh, give me a break.

They move last.

This morning the bears are breathing a huge sigh of relief because ASML (ASML - commentary - Cramer's Take) reported crummy orders. Ignore the earnings; the orders show the future, they say. Bears want to take that piece of information and hold it as a cudgel, letting us know that no tech rally is bona fide without the ASMLs and Novellus (NVLS - commentary - Cramer's Take), KLA-Tencor (KLAC - commentary - Cramer's Take) and Applied Materials (AMAT - commentary - Cramer's Take).

To me these are yesteryear stocks, but I recognize that without them moving we are forever going to be under siege about whether the tech rally is for real.

I say, hold on. You are looking through the rearview mirror with ASML's orders. You should be looking at semiconductor foundry utilization. That's what will predict order growth, not ASML's statements.

There, the news is all good. I use Taiwan Semiconductor, the biggest foundry out there, as my barometer for the future, and that's flashing green, not red. TSM's utilization was 78% in the March quarter and 84% in the June quarter, and with wafer starts up significantly in September (my prediction, but it should come true, judging by what we are seeing in the end technology markets, think Best Buy), you could get mid-90% utilization by the fall.

And that's when they will order!

Remember, I am not waiting for the tech good news to occur. I am anticipating the good news. If you don't anticipate the tech rally, you miss it.

The real story this July is the continued strength in Intel (INTC - commentary - Cramer's Take) and Samsung, the big guns in semis. That will yield the good news that needs to be anticipated now.

Don't wait for the orders to turn up. That's a sucker's game.

Act now. Use the ASML weakness to buy, not sell.

Random musings: Uh oh, I don't care how long Ebbers gets. Can't make money off it. ... The action in IBM (IBM - commentary - Cramer's Take) and Symantec (SYMC - commentary - Cramer's Take) is pure catch-up, but I wouldn't fight it; the darned stocks are now working. So's McAfee (MFE - commentary - Cramer's Take).

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At the time of publication, Cramer was long Intel.

James J. Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. Outside contributing columnists for TheStreet.com and RealMoney.com, including Cramer, may, from time to time, write about stocks in which they have a position. In such cases, appropriate disclosure is made. To see his personal portfolio and find out what trades Cramer will make before he makes them, sign up for Action Alerts PLUS. While he cannot provide personalized investment advice or recommendations, he invites you to send comments on his column by clicking here. Listen to Cramer's RealMoney Radio show on your computer; just click here. Watch Cramer on "Mad Money" at 6 p.m. ET weeknights on CNBC. Click here to order Cramer's latest book, "Real Money: Sane Investing in an Insane World," click here to get his second book, "You Got Screwed!" and click here to order Cramer's autobiography, "Confessions of a Street Addict."