Expiration Is Driving Down the Prices

We see a lot of option pressure today exacerbating the profit-taking. But more worrisome to the seasoned players is the speculation, rampant speculation, in Citigroup (C - commentary - Cramer's Take), AIG (AIG - commentary - Cramer's Take), and Fannie (FNM - commentary - Cramer's Take) and Freddie (FRE - commentary - Cramer's Take). These are reaches that frightened people who have traded for years because they are signs of froth, and froth means the end of the move for now.

I refer to my earlier piece about the troika and the need to maintain all of the leaders, and I am worried about the financials being maintained -- the Geithner dilemma.

So, what does it come to? I think it means

1. Profit-taking is going to prevail today.
2. The financial rally could continue but not now.
3. The underpinnings of the moment are being undercut by the tremendous decline in the Johnson & Johnson (JNJ - commentary - Cramer's Take) / Procter & Gamble (PG - commentary - Cramer's Take) cohort, which proliferate in the averages.
4. Expiration woes will play havoc with the overbought market.
5. Wait until it comes in and we get stocks at round numbers to the downside.

Examples: General Mills (GIS - commentary - Cramer's Take) at $45, PG to $45, Goldman (GS - commentary - Cramer's Take) to $100 or maybe $95 (ugh!), Coke (KO - commentary - Cramer's Take) to $40 and IBM (IBM - commentary - Cramer's Take) to $90.

Bleak?

No.

Reasonable. You do not get by unscathed in an expiration week with no down days. Those are too rare and can be counted on with one hand's worth of fingers.

At the time of publication, Cramer was long Goldman Sachs, General Mills and Johnson & Johnson.

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