Sooner or later, every selloff comes to an end, Jim Cramer told his Mad Money viewers Tuesday, and this is the level at which investors should be buying -- before the next leg higher begins.
Cramer explained the markets have been selling off for two reasons: Chinese trade talks and last week's implosion of Facebook (FB) .
But on Tuesday, we heard rumors that trade talks might be resuming, which was enough to spark interest in the likes of 3M (MMM) , Honeywell (HON) and United Technologies (UTX) and push the entire industrial cohort, along with the "China stocks", higher.
Cramer reiterated that investors should just own Apple for the long term, as Apple is the greatest consumer company the world has ever seen. If Apple was given the valuation it deserves, Cramer said, shares would be valued at $280 a share, a far cry from the company's current price/earnings multiple.
So with the two main selling forces eliminated, at least for the moment, Cramer said this is the level investors need to commit to, because it won't be long before the money managers and hedge funds start buying in, and that's when the rally will once again kick into high gear.
Cramer and the AAP team say it never hurts to look at the charts of stocks to gain another perspective: Anadarko Petroleum Corp. (APC) . 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.
Follow the Money
Overlook our strong economy at your own peril, Cramer cautioned viewers. Job growth is still on the rise in our country, and that means investors need to follow the money to profits.
Home Depot (HD) should also be on investors' buy lists, as many of this company's suppliers have had great things to say this quarter.
What else benefits from strong hiring and job growth? Cramer said he still likes Paychex (PAYX) and rival Automatic Data Processing (ADP) , especially with more interest rate hikes coming. Uniform supplier Cintas (CTAS) is also attractive.
Finally, Cramer gave another plug to Apple, because when consumers have jobs and are flush with cash, they buy more devices and services from Apple.
Over on Real Money, Cramer says there's a strong case to go back and look at retail. Get more of his insights with a free trial subscription to Real Money.
Off the Charts: Gold
In the "Off The Charts" segment, Cramer checked in with colleague Carley Garner to find out where the price of gold might be heading next. With our roaring economy and strong dollar weighing on the precious metal as of late, is it time for a rally?
Garner first looked at a historical chart of gold's seasonal swings and noted that buying and holding gold between July 24 and Sept. 6 has been a money-making move for 13 of the past 15 years.
This thesis was confirmed when looking at a weekly chart of gold futures and the Commitment of Traders, or COT, report. Most institutional investors are bearish on gold and the last time things looked this bad, in December of 2015, gold saw a monster move to the upside.
Garner concluded by noting that after a three-month slide, gold is now at its floor of support, making the path of least resistance higher.
To look over the charts and get more of Cramer and Garner's analysis, read What's the Outlook for Gold? Cramer's 'Off the Charts'.
Executive Decision: PoolCorp
For his "Executive Decision" segment, Cramer spoke with Manny Perez De La Mesa, president and CEO of PoolCorp (POOL) , the company with shares that have more than tripled over the past five years.
Perez De La Mesa said that after 20 years at the helm of PoolCorp, it's time to make a change, which is why he will be stepping down at the end of the year. He said PoolCorp has an excellent team and will be in good hands.
When asked about his company's business, Perez De La Mesa said that PoolCorp is in business to support over eight million pools currently in the U.S. and another eight million internationally. About 70% of the company's sales comes from contractors that build, repair and refurbish pools and PoolCorp's job is to provide the parts and supplies they need to be successful.
When asked about the weather, Perez De La Mesa explained that PoolCorp does have seasonal business in the Northeast, but also plenty of year-round business in other parts of the country.
Cramer said he's confident that this stock is headed higher.
Executive Decision: Cypress Semiconductor
In his second "Executive Decision" segment, Cramer checked in with Hassane El-Khoury, president and CEO of Cypress Semiconductor (CY) , which last week posted a four-cents-a-share earnings beat that sent shares up over 6%.
El-Khoury said that he's a big believer in free trade, but also feels that U.S. companies need intellectual property protections. He explained that Cypress expects tariffs to account for a 1.5% decline in revenues, but added that the company is already working to mitigate those losses.
As for their business outlook, El-Khoury was bullish on both automotive and the Internet of things, IoT. He said that Cypress is both adding more technology and taking market share in the automotive sector, while the Internet of things also is growing, bolstering the company's gross margins and bottom line.
Cramer was bearish on Evolent Health (EVH) .
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