Benign so far, but we don't want to give back too much here. I also don't mind the rally in the consumer stocks. We want this market to be balanced. If you were to ask me what I didn't like about Thursday's rally, I would say, "All of these 5-point gains on new news. That's not sustainable."
A lot of that will always turn out to be expiration-related and basket-related. I don't want to sound like an old fogey, but the constant proliferation of basket products has gotten stocks even further removed from the companies. The maniacal move Thursday in oil services names was totally related to options on various baskets, not the fundamentals. Guys who were short, guys who sold puts moved up these stocks.
Now those gains are given up and nobody trusts the stocks because their actions are not interpretable by anything other than the mechanics of options -- and that's something very few people understand.
Bottom line: If we hold here, we are fine. If we go down much more, people will say, "OK, it was all phony."
Don't want that, don't want that at all.
P.S. Will you be there when Cramer makes his next move?
Strong brands and companies with vast market exposure can help bolster your portfolio. Jim was able to lock in a 64% gain by buying Ingersoll-Rand at $13 and selling at $22.50. Action Alerts PLUS members were the first to see these moves. Were you among them? Get Free Access Today!
Jim Cramer Blog How Homework Helps: Urban Outfitters 6/16/2006 10:22 AM EDT This stock would have killed your portfolio if you hadn't stayed on top of its souring fundamentals.
Jim Cramer Blog Pick the Right 'Discount' Brokers 6/16/2006 9:56 AM EDT Goldman Sachs and Bear Stearns have better businesses and lower multiples than Schwab and its ilk.
Jim Cramer Blog Focus on Balance Here 6/16/2006 9:39 AM EDT The recovery must be used not to get more defensive but to be sure you are diversified.
Jim 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. 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." While he cannot provide personalized investment advice or recommendations, he invites you to send comments on his column by clicking here. TheStreet.com has a revenue-sharing relationship with Traders' Library under which it receives a portion of the revenue from Traders' Library purchases by customers directed there from TheStreet.com.
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