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NEW YORK (TheStreet) -- This market may be rangebound with little hope of a sustained advance, Jim Cramer warned his Mad Money viewers Tuesday. It's not that earnings aren't terrific or that companies aren't doing a great job, but the mighty U.S. dollar may be a headwind that the markets just can't overcome.
Cramer said there are a number of things he looks at to determine which way the markets are heading. First is how the markets are reacting to earnings. Upside surprises from both Cracker Barrel (CBRL) and Dollar General (DG) were treated positively, so that was good news.
Then there's how the markets react to news flow. Today's strong auto sales were not met with overwhelming enthusiasm, a sign that investors are smart enough to know that strength in the U.S. does not translate to the rest of the globe.
There are also other key metrics, like interest rates and the price of oil, both of which have an effect on the markets on any given day.
But then there's the strength of the U.S. dollar, a single metric that now holds the fate of the entire market in its hands. Why is the dollar so important? Currencies can turn an excellent quarter into a mediocre one, just as it did with PVH (PVH), as CEO Manny Chirico told Cramer on last night's show.