Despite strong results, many of the biggest companies moved lower following reporting earnings. Jim Cramer took to Real Money Thursday to hypothesize that stocks are facing a prism effect. No matter how strong the earnings report, we are in a period where stocks are done going up and the apocalypse is nigh, Cramer wrote.
"Right about now in earnings season our confidence shifts. If the first two weeks were negative and we got hammered then we would have a change of heart right about now. We would start looking at bad as not so bad, good as great and great itself as a propulsion rocket of astounding proportions that has to be bought no matter what."
Cramer told Action Alerts PLUS senior analyst Jeff Marks that his prism theory tells him that "people will find holes" even if Facebook (FB) - Get Facebook, Inc. Class A Report reports strong earnings after Wednesday's closing bell.
Watch his full take in the video above.
Recap TheStreet Live: Everything Jim Cramer Is Watching 7/28
Facebook is a holding in Jim Cramer's Action Alerts PLUS charitable portfolio.