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Jim Cramer: I want to call it for purposes of alliteration and for you. We got the three M's. The macro worry, the micro worry and the mechanics worry. Last of the m's, the three m's, mechanics. Here's what we had been stressing over and over again. It's the influx of new supply. We very much wanted to get through what we called Hell Week. We were all waiting for the stock that was Uber. It turned out that hell week was worse than we thought. As Uber got priced the same day as the president said, the Chinese and re-traded their deal. You get that kind of action, there simply isn't enough money to absorb the Uber supply. And so therefore a lot of the, the longs that portfolio managers have to sell other stocks to buy their Uber. Well, you saw what happened there? There's, there was still too much Uber.

Jim Cramer: It was a nightmare. And we are so glad that we were the leanest right into the IPO. It really saved us a lot of money. But it wasn't just the IPOs. We are not chartests at heart, but we knew from the excellent chartests who write for Real Money. The things were as bad as they come. You had to work so hard to find that unbroken chart other than utilities. Hey, charts matter. Most portfolio managers, I know are closet chartests. They were pointed down. When you get too much supply and terrible breakdown, so you get liquidations. And we started at the end of the month to see those too. So when you see the macro, the micro and the mechanics about the breakdown. You have to take action. And that's exactly what we did. And when the selling was over we were ready to buy and we had the cash to do so.

How should investors react when the macro, micro, and the mechanics start breaking down?

Jim Cramer broke down how he and his team over at Action Alerts PLUS responded when the markets started to take a turn for the worst. 

During his June Action Alerts PLUS June conference call, Cramer explained what he and his team did to protect themselves. 

"We are not chartists at heart but we knew from the excellent chartists who write for Real Money that things were as bad as they come. You had to work so hard to find an unbroken chart other than the utilities. Charts matter," said Cramer. "Most portfolio managers I know are closet chartists. They were pointed down. When you get too much supply and terrible breakdowns you get liquidations and we started, at the end of the month to see those, too."

"So when you see the macro, micro, and mechanics about to break down, you take action. That's exactly what we did and when the selling was over we were ready to buy and we had the cash to do so," he continued. 

Want to know what else Cramer only told members of his Action Alerts PLUS investing club? Recap his full call here.

Jim Cramer Reveals When to Sell a Stock