Sometimes, stock picking is all about seeing the patterns, Jim Cramer told his Mad Money viewers Tuesday, even if those patterns are completely obvious and don't make a whole lot of sense.
Case in point, Tuesday's weakness in shares of Apple (AAPL) - Get Report. Apple's new iPhone 12 was panned by technology pundits as only "incremental," but Cramer reminded viewers that the pundits say that every year. The reality is that Apple's latest iPhone has 5G and lots of other new features that consumers will love. Cramer reiterated that shares of Apple are always a buy on weakness.
Another pattern that's easy to spot, Amazon (AMZN) - Get Report. Amazon's Prime Day was announced weeks ago, but investors only recently started sending shares higher. Cramer said you should never pay up for an event that everyone already knows about, but that's exactly what novice investors have been doing.
The third pattern in the market, the financial tech trade. Anytime Citigroup (C) - Get Report or JPMorgan Chase (JPM) - Get Report report news, good or bad, investors sell the banks and instead, snap up shares of fin techs like PayPal (PYPL) - Get Report and Square (SQ) - Get Report.
Lastly, Cramer said investors can count on the COVID pattern. Anytime there's bad news on the COVID front, like today's clinical trial pause at Johnson & Johnson (JNJ) - Get Report and Eli Lilly (LLY) - Get Report sent up shares of stay-at-home stocks like Peloton (PTON) - Get Report, DocuSign (DOCU) - Get Report and Roku (ROKU) - Get Report.
You'd think these patterns would be obvious and therefore wouldn't work, Cramer concluded, but you'd be wrong. They still run like clockwork.
Cramer and the AAP team are looking at everything from earnings and tariffs to the Federal Reserve. Find out what they're telling their investment club members and get in on the conversation with a free trial subscription to Action Alerts Plus.
Don’t miss Cramer’s best, every day, with fast, actionable strategies: StreetLightning.
Off the Charts
In the "Off The Charts" segment, Cramer checked in with colleague Tom DeMark over where the market rally might be headed going into election season.
DeMark looked at a daily chart of the Dow Jones Industrial Average and using his proprietary timing models, predicted a September peak in the Dow between 29,400 and 29,500. While the Dow did indeed make a peak in DeMark's September time, the average missed his price target. After recalculating, DeMark now predicts we are nearing the end of this market rally, which again is testing his original price target.
DeMark felt there may be two to three days left in this rally before the market ticks lower.
Cramer agreed with DeMark's thesis, saying that stocks have run up going into earnings season and will likely make a top soon. Interestingly, DeMark also felt that after a quick selloff, the markets would bottom right before the election, a sentiment that Cramer also completely agreed with.
Too Soon for Cruising?
Is it too soon to speculate on the cruise lines? Today's news that Royal Caribbean Cruises (RCL) - Get Report is raising another $1.2 billion to help it survive the pandemic sent shares plunging 13.2%. Cramer said that might be your chance to buy.
The cruise lines have been under a no-sail order since March. That order was expected to be extended into February 2021 until the White House demanded it expire at the end of October. While the cruise lines have been allowed to sail in certain European markets, Cramer said they are not investable until we have a vaccine for COVID-19. When that happens, here's how the cruise lines stack up...
Cramer said Royal Caribbean tops the list. The company has borrowed or raised $8.4 billion and is burning nearly $300 million every month it cannot sail. Carnival Cruise Lines (CCL) - Get Report came in second on Cramer's list. The company has raised $12 billion and has aggressively cut costs, selling 18 ships. Last on the list was Norwegian Cruise Line Holdings (NCLH) - Get Report, which has raised only $6.8 billion and is burning $160 million a month while it waits for normal operations to return.
Executive Decision: Celsius Holdings
In his first "Executive Decision" segment, Cramer spoke with John Fieldly, CEO of Celsius Holdings (CELH) - Get Report, the energy drink maker that's seen 86% revenue growth, but also its share of doubters.
Fieldly explained that Celsius is not some fly-by-night supplement, it's clinically-proven to burn calories and fat and is riding the health and wellness trend. He said their products were designed by sports nutrition specialists and tested in double-blind studies.
The proof is in the share price, Fieldly added, as shares of Celsius are up 374% for the year. Distribution is key in the beverage market and Celsius is building a national distribution network that includes Walmart (WMT) - Get Report, Target (TGT) - Get Report and CVS Health (CVS) - Get Report. The company's products already have 10% market share and is the third largest energy drink brand on Amazon.
On Real Money, Cramer keys in on the companies and CEOs he knows best. Get more of his insights with a free trial subscription to Real Money.
We Can Beat This
In his "No-Huddle Offense" segment, Cramer said we can't beat this pandemic without a vaccine, but we can make it a lot less intolerable if we stay disciplined and take it seriously.
While it's true that testing is becoming more widely available and treatments, like those from Regeneron (REGN) - Get Report, are inching their way towards general availability, the only way to stamp out a third wave of the virus is with masks and social distancing. As we saw with Johnson & Johnson today, vaccines take time to develop safely, which leaves masks as distancing as our only weapons in the meantime.
Here's what Jim Cramer had to say about some of the stocks that callers offered up during the Mad Money Lightning Round Tuesday evening:
Search Jim Cramer's "Mad Money" trading recommendations using our exclusive "Mad Money" Stock Screener.
To watch replays of Cramer's video segments, visit the Mad Money page on CNBC.
To sign up for Jim Cramer's free Booyah! newsletter with all of his latest articles and videos please click here.
At the time of publication, Cramer's Action Alerts PLUS had a position in AAPL, AMZN, JPM, JNJ.