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Some stocks have moved too far, too fast while others have slid too far in the other direction, Jim Cramer told his Mad Money viewers Thursday, as he described his plan for trading a bifurcated stock market.
Cramer said that before the election, investors were betting on a Hillary Clinton win, but when Trump surprised everyone, those trades quickly reversed, sending the industrials and the banks higher, while tech sank.
But once investors realized that a Trump presidency would be a pro-business and pro-growth presidency, new money began flowing into the markets, sending everything higher.
Now, the new money has exhausted itself -- at least for the moment. That means that for the winners to rise, the losers must fall. Many of the moves were just too aggressive and not sustainable, Cramer said. It's natural to see investors take a pause.
Cramer said he's now looking to buy some of the stocks that are being thrown away, because -- over time -- a pro-growth administration will lead to higher earnings for everyone.
Don't get too skeptical, Cramer concluded. Give it some time and be prepared to ride the next rotation higher.
Coming up on tonight's episode: Cramer interviews Bob Sulentic, CEO of CBRE Group (CBG) and Stanley Bergman, CEO of Henry Schein (HSIC) . Plus, the importance of diversity in the biotech sector, and don't miss the Lightning Round: Which stocks is Cramer bullish on?