This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Wait It Out

This article originally appeared on Jan. 24, 2014 on RealMoney.com. To read more content like this + see inside Jim Cramer's multi-million dollar portfolio for FREE! Click Here NOW.

So, do you blow up your year and buy the high-quality industrials that are levered to China now that they are giving them away?

Or do you go for some short-term performance and buy the recession stocks as my day-two playbook suggests?

Ideally, right now, you should be coming in with everything you have and buying Clorox (CLX - Get Report), Procter & Gamble (PG - Get Report) and Johnson & Johnson (JNJ - Get Report) and Bristol-Myers Squibb (BMY - Get Report) -- yes, even up here.

You should still be shorting all of the industrials, pressing hard and betting that the analysts capitulate and throw them out on the China worries and the emerging market issues.

Must Read: Jim Cramer: I'm Sure the President Means Well

They almost always capitulate in the end. 

But there's one problem: You just might have to reverse everything on a dime within the next three days.

So my suggestion is to circle the wagons around the industrials you can handle and take that additional cash and buy the Johnson & Johnsons of the world that are on the 3% yield precipice and haven't moved up yet.

At the same time, though, on Monday I think you have to be ready to buy the downgrades of these industrials that would have shed far more than we ever thought they could just a few days ago.

Remember the game plan: day one (yesterday), they all go down; day two, they differentiate, and buy the bond market equivalents and the recession-proofs; day three, they wade back into the companies that just reported great quarters -- that's Monday -- and you cover your industrial shorts. (Looks like Doug is a day ahead of me!)

Only by Tuesday -- yes, the cycles are that compressed -- can you buy the stocks of the very companies that are doing well. Painful, but you do have to wait. Don't worry. You will get your chance!

At the time of publication, Action Alerts PLUS , which Cramer co-manages as a charitable trust, was long JNJ and PG.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free

Markets

Chart of I:DJI
DOW 17,773.64 -57.12 -0.32%
S&P 500 2,065.30 -10.51 -0.51%
NASDAQ 4,775.3580 -29.9330 -0.62%

Our Tweets

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs