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Jim Cramer: Lennar Is the Tell

Editor's Note: This article was originally published at 7:00 a.m. EDT on Real Money on Sept. 23. To see Jim Cramer's latest commentary as it's published, sign up for a free trial of Real Money.

NEW YORK (Real Money) -- If there could be one quarter that might define this week, it will be Lennar's (LEN) on Tuesday. Here's a high-quality national homebuilder that had a very good quarter last time out.

Lennar jumped up a couple of bucks on the big move in Treasury interest rates as money rotated right back into homebuilders when the Federal Reserve whamma jamma'd the bears.

Now, Lennar was the most bullish of all homebuilders going in to the last quarter, when it had improving gross margins, low cancellations and a huge backlog. All three, if you listen to the bears, are in jeopardy, particularly since this is a quarter that has taken place entirely amid the elevated new mortgage rates.

There are two components to this quarter. First, is this possibly the last good quarter because the mortgage lock-ins are now over? Or, second, have rates stabilized or gone lower now, meaning that buyers are coming back into the market?

We had a hideous market Friday almost entirely because of Washington fecklessness. I think at a certain point that will be built in, but not yet.

Still, Lennar is the tell. If it rallies, we'll know there is a new place to go. If it doesn't, I think the homebuilders may not be a place to be for a very long time.

At the time of publication, Action Alerts PLUS, which Cramer co-manages as a charitable trust, had no positions in the securities mentioned.

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