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Jim Cramer's 'Mad Money' Recap: The Market's Message


Cramer said he's encouraged by the many biotechs that moved into the green today, as well as LinkedIn's (LNKD) surge in the face of a downgrade, a positive sign for both the company and the sector as a whole.

Off the Charts

Cramer thinks 2014 is going to be a banner year for Bank of America (BAC), which will benefit from rising interest rates and has enormous room to run with most of its litigation behind it. A lot of big banks have already rebounded hard, and the same is imminent for Bank of America, another AAP holding.

Cramer introduced a chart by RealMoney's Tim Collins to dig deeper. Collins' chart is so positive, it's like bear repellent for short-sellers, Cramer said. Who wants to pick a fight with a raging bull?

Bank of America is already up 6% this year, on the heels of a 36.48% return in 2013. Don't get too greedy about waiting for a pullback. You might get some small decline, but Collins doesn't expect much of a drop.  The stock is coming out of a nice period of consolidation after a nice push in November. If the current run is the same size as November's $2 per share rise, Collins thinks the stock is headed to at least $17.75 per share near-term, up from $16.50 at today's close.

Ideally, Collins would like to see a pullback to $16.10 or $16.25, but there are plenty of signals that Bank of America could be a buy at current levels, Cramer said.

While Bank of America's accumulation-distribution line has been trending lower, Cramer said, the technical analyst isn't concerned. Each time in recent months that the company's stock has hit a floor of support, it has rebounded and been a buy, a rebound we're seeing in the first few trading days of 2014 and that could continue unabated for a few weeks.

Since the beginning of 2013, Bank of America has had a strong and steady upward channel, about as textbook a bullish trend as they come, Cramer said. Every accumulation-distribution line drop has been met with a rebound, providing a read on what the big institutional investors are doing.

Stick to Your Guns

Ready to cut and run? If you've put a lot of time and research into a stock buy, it's important to stick to your guns and don't back down, Cramer said. Last year, Cramer heard many calls to pull out of the market, but the S&P 500 finished up 29.6% all told. Selling into weakness would've cost you some amazing gains.

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