This Phantom Tech Rally's Got No Juice

Let's just come out and say it: The tech rally has no clothes. It began when IBM (IBM - commentary - Cramer's Take) reported a better-than-expected quarter, busting a lot of the gloom. It continued when we had continued rallies in the Semiconductor HOLDRs (SMH - commentary - Cramer's Take) for no apparent reason. It accelerated when Research In Motion (RIMM - commentary - Cramer's Take) and Apple (AAPL - commentary - Cramer's Take) exploded higher, the latter a real levitation in spite of the Jobs illness report. It went still higher after the great Amazon (AMZN - commentary - Cramer's Take) report and the Google (GOOG - commentary - Cramer's Take) ramp up 20%. The final coup de grace to the bears was when Cisco (CSCO - commentary - Cramer's Take) reported an OK number and then said the growth would be down 10% to 15% ... and the Nazz went up anyway.

Throughout this rally, I was dragged kicking and screaming because the only real growth area in this market is in smartphones, and we have seen the Apple/RIMM rally go about as far as it can go, given the RIMM softness. Amazon is valuation-stretched. Google? I can't pay it up here; if you can, good luck, but a simple question must be asked: Can you justify a 20% increase in the face of a much worse ad market than last quarter? I can't. I want to say right here, emphatically -- take profits.

As is usually the case, we are seeing a move up in tech, a kind of rearguard action rally no doubt motivated by managers wanting their own stocks higher. We have seen it before.

Why not accept the fact that IBM was an aberration? That Apple's good but not this good? That Google's OK but not this OK? That RIMM is as good as it gets (which isn't that good)? That Intel (INTC - commentary - Cramer's Take) and Microsoft (MSFT - commentary - Cramer's Take) have nothing special going on despite their rallies and, most important, that John Chambers is right and things are just not so hot, so there are more reasons to sell the SMH and the PCs and the cell phones than there are to buy? (I like Hewlett-Packard (HPQ - commentary - Cramer's Take) because of EDS and Qualcomm (QCOM - commentary - Cramer's Take) because of 4G, but I am not buying more of them here forAction Alerts PLUS.) Why not sell the EMC (EMC - commentary - Cramer's Take) on false takeover chatter and the Texas Instruments (TXN - commentary - Cramer's Take) which is up, once again, because they seem cheap?

Why not walk away and start over again lower, where I think the group is headed?

That's my best case for what to do here as the tech bulls try to keep the balls in the air.

Will they succeed? I don't even care. I want to be a seller based on the fundamentals, not the action, even though I have been a bear on the fundies and accepting of "the action" ... until now.

Random musings: I thought Goldman put out a great piece today about Kohl's (KSS - commentary - Cramer's Take) and how expensive this and other retailers are. I agree. ... How about this "let's break Wells Fargo (WFC - commentary - Cramer's Take)" game that is played out every day? ... Good riddance to Charter (CHTR - commentary - Cramer's Take), a miserably, horrible, indebted company that has done everything wrong. ... The worst management in the world, the management of Dow Chemical (DOW - commentary - Cramer's Take), cuts its dividend. These guys are unbelievably bad.

At the time of publication, Cramer was long Goldman Sachs, Wells Fargo, Qualcomm, Hewlett-Packard and Cisco.

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