There was a "prolonging of the agony in the oil patch" today as the sector experienced a bounce, sucked people in and then went back down, Jim Cramer said on his
"RealMoney" radio show Wednesday.
A lot of people believe that these oil stocks can't continue to decline, but this is untrue, Cramer said. However, there are some promising signs, he said.
went up despite a bad quarter, and
National Oilwell Varco
, which had a downgrade, was momentarily up but went down again, Cramer said.
"Maybe you can start nibbling," he said. "But these are just symptoms of a bottom and not the real thing. Oil's still going down."
Cramer said he still cannot have people in this space as "there is no bottom until massive capitulation occurs." He doesn't trust the move oils saw today.
In the meantime, oil stocks can pay dividends while investors wait for a turn, making the ride less painful," he said.
Cramer said he is seeing a new pattern where companies that are heavily shorted are starting to perform better when they report in-line numbers. Two companies that demonstrate this are
, he said.
Despite reporting "so-so numbers" today and "opening down and flat," the stocks are "flying," Cramer said.
"I believe that's because the short positions in these stocks are gigantic -- particularly when matched with the float," he said. "These stocks are so hated and so gamed to the downside that they are acting as if they reported upside surprises."
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