Cramer's Call: Another Rally Top Indicator?

Wow, the bulls are really feeling good. “Wells Fargo Carries The Day” and the S&P and Dow closed at 2 months high and the Nasdaq is near its highs for the year.

On Mad Money this evening, Cramer went so far as to call “a turn in the economy”, saying “the facts have changed”, “the situation has clearly improved” and “things are getting better”.

This isn’t the first time Cramer has called a bottom and he’s been wrong before (For example, see “Cramer Declares The End Of The Bear Market” , Top Gun FP, July 31, 2008). The market topped out a couple weeks later.

On Monday October 6, Cramer went on the today show and told people to sell any stock money they might need in the next five years. The market bottomed that Friday.

It could run another couple weeks but this rally is running thin. Methinks me smells a top…..

Comments

[Dave Wrixon]

The likes of Cramer simply make these comments to create market opportunities. Don't be fooled into thinking that they are for your benefit. Why would they give you first class investment information for free?

2009 Apr 10 04:11 AM

[leapingsioux]

I have to disagree with you. let's see who is right!
I think what Cramer was saying is that there is a very small chance that DOW will hit the 6500 level again while there is a good chance it will stay at or above 8000. And when he said do not invest money that you may need for the next 5 years, no one knows what the fed reserve may do or if treasury dept can come up with the right plan. Now after WFC's upside surprise, it is a confirmation that the worse is behind us.

2009 Apr 10 04:20 AM

[Fighting Yoda]

Doing opposite of Cramer is a good strategy.

2009 Apr 10 04:43 AM

[capitalisthero.com]

You'd be better off throwing darts at the stock page or having a chimp give you financial advice than listening to Cramer.

Dollar cost average into commodities now before the inflation wave hits.

Check out my original article at capitalisthero.com for more strategies.

2009 Apr 10 05:04 AM

[schlumpf]

If every bad news are good news, why isn't Cramer's Call a better than expected new ??
Maybe the DOW is now going to 14.000 ??
We all know now, the recession is over, all banks are solvent, everything is good as it was 2 years before or better, because of the bailout money.
The unemployment?? No problem in 1 year or in 10 years they are less.
If unemployment rise? No problem
No people buy cars, now cars buy cars. This cut spark a rally by GM and Ford.
The sun is shining, its easy to make money. We only have to buy stocks
Today a taxidriver told me: "Buy bank stocks and you will make a lot of money". It was the same, who told me in march: "sell your stocks". We all know taxidriver and shoemaker are allways right.

About Cramer, this year he was right. In the Obama rally he wrote, dont buy this rally, in the march lows he wrote, buy buy buy.

2009 Apr 10 06:34 AM

[drbob66]

"On Monday October 6, Cramer went on the today show and told people to sell any stock money they might need in the next five years. The market bottomed that Friday."

Huh? The market bottomed on October 10th? Really?

2009 Apr 10 07:39 AM

[prudentinvestor]

The above comments lead me to conclude that Cramer is right half the time and wrong half the time. This seems to be in-line with expectations for experts and pundits.

2009 Apr 10 08:33 AM

[Tom Foolery]

Cramer? Put a megaphone in his hand and give him a peach crate center-section of the Midway. Then throw in a few g-strung ladies and open a beer concession nextdoor. You'll make good fast money. Be careful though: there's an unsavory character behind you. He's got his hand moving too.

2009 Apr 10 09:51 AM

[jdl51]

If you are half way educated about the market, your guess is as good as anyone's. Hopefully your right guesses outnumber your wrong guesses. Cramer is entertaining and on occasion does provide some insight, but like anyone, expert or not, luck is the name of the game.

2009 Apr 10 09:53 AM

[richjoy403]

I like Cramer...and I hate Cramer.

It is far too easy to criticize his bad calls while ignoring his good calls (I don't read anyone here criticizing Abby Joseph Cohen or others). Although often Cramer has something useful to say, I resent and will never attempt to justify his treating a serious topic like a circus barker touting a lion tamer.

Like Rush Limbough, I an take him only in very limited doses.

2009 Apr 10 10:01 AM

[mcl2177]

The market is rallying beccause the Gov. wants it to. Remember they are shareholders of most of these banks especially the big ones so of course they are going to do everything in their power to prop them up. Just yesterday they said that all of the banks will pass the stress test but they will all need more bailout money. What does that mean? As far a earnings go (for banks) they will be better the what was expected because of the accounting changes made which do apply to Q1, the fact that there have been mergers and because the expecations are so low. I don't believe in the long run that this partnership between the Gov. and the banks will end nice but right now follow the Gov. and the Tape at right now that says the market is going up. But I would still proceed with caution after this month is over.

2009 Apr 10 10:54 AM

[joes]

Wow, you can smell a top, using the sense of smell for investment strategies is an interesting tactic.

You have to be careful though, once I thought I smelt a windfall, but it turned out that my dog just had gas, not unlike the vast number of financial experts.

2009 Apr 10 11:48 AM

[InvestBaboo]

I suggest you look at what people are actually doing -- not what they are seeing. What you will see is a resurgence in a multitude of stocks in a multitude of industries. When you do this it is very easy to see that Gold is a Sell and banks are a buy and so on. When you deep analyze the patterns you may actually see that we are at the beginning phase of another bull market like the one that began after Regan took over.

I am of the opinion that the kick in the jewels that America got in 2008 will lead to a better people and stronger nation. That is the premise on which I am hanging all these extraordinary bull signs I am seeing in the charts. Continuing on that premise I think that several stocks that trading today at single digits that have shown unusual chart patterns could actually top their 2007-2008 52 week highs in the next couple of years! We are presented with an extraordinary wealth creation opportunity but many of us I suspect will sit on the sidelines and lament later with hindsight. I am going to author an article that highlights well over 70 or so stocks that I picked when the Dow was at its lowest and to date has appreciated considerably from the date of purchase. I have reason to believe that many of them will exceed their previous highs in the next couple of years. Imagine this -- 500 shares bought at 1500 bucks could be worth $20K or $30K or $70K in just a handful of years! Do not ignore the opportunity at hand to make extraordinary wealth. Shut out the noise and see what is really going on not what people are talking about.

Last point about Cramer. He reminds of me a story I heard at childhood about the boy who cried wolf. The first two times he pranked but the third time when he was right no one listened. Cramer is right this time.

2009 Apr 10 12:09 PM

[dsrtwriter]

Cramer has led many people to significant losses with his erratic shifting of positions.Maybe things are improving; he would be better to just say he is not sure.But he is always "sure", until he is wrong and says "I hurt people, I apologize".

I use him as perhaps not a contrarian indicator but at least as an amber traffic light, but the reality is that I stopped watching his show a year ago. I do better watching Turner Classics.

2009 Apr 10 12:11 PM

[Robert Bunting]

nice article , but who is Cramer , huh

2009 Apr 10 02:02 PM

[Tony Daltorio]

Now let's see -- Banks are allowed to legally lie about the value of the assets on their books, Cramer says all is well, more individuals (since 1999) have become "traders", more and more bulls like InvestBaboo are appearing in places like Seeking Alpha -- Why are images of the Hindenburg coming to mind??

2009 Apr 10 02:29 PM

[sr9web]

So you're saying "it's different this time"?


On Apr 10 12:09 PM InvestBaboo wrote:

> I suggest you look at what people are actually doing -- not what
> they are seeing. What you will see is a resurgence in a multitude
> of stocks in a multitude of industries. When you do this it is very
> easy to see that Gold is a Sell and banks are a buy and so on. When
> you deep analyze the patterns you may actually see that we are at
> the beginning phase of another bull market like the one that began
> after Regan took over.
>
> I am of the opinion that the kick in the jewels that America got
> in 2008 will lead to a better people and stronger nation. That is
> the premise on which I am hanging all these extraordinary bull signs
> I am seeing in the charts. Continuing on that premise I think that
> several stocks that trading today at single digits that have shown
> unusual chart patterns could actually top their 2007-2008 52 week
> highs in the next couple of years! We are presented with an extraordinary
> wealth creation opportunity but many of us I suspect will sit on
> the sidelines and lament later with hindsight. I am going to author
> an article that highlights well over 70 or so stocks that I picked
> when the Dow was at its lowest and to date has appreciated considerably
> from the date of purchase. I have reason to believe that many of
> them will exceed their previous highs in the next couple of years.
> Imagine this -- 500 shares bought at 1500 bucks could be worth $20K
> or $30K or $70K in just a handful of years! Do not ignore the opportunity
> at hand to make extraordinary wealth. Shut out the noise and see
> what is really going on not what people are talking about.
>
> Last point about Cramer. He reminds of me a story I heard at childhood
> about the boy who cried wolf. The first two times he pranked but
> the third time when he was right no one listened. Cramer is right
> this time.

2009 Apr 10 05:37 PM

[Stone Fox Capital]

The market bottomed in Oct??? The 2008 lows were in Nov and heck we had much lower lows in March this year. Cramer has a lot of issues, but he hasn't been bullish all along.

2009 Apr 10 05:54 PM

[latamike]

Well here we are. Hindsight is always 20/20 and Cramer puts his n*ts on the line every night to make recommendations on the market and make stock picks. I hate to tell you guys this but he called the bottom on the very first day the market was up and that was around 6500. If you listened and bought you would have made upwards of 20% right now.Good point to remember....."don't hate the player, hate the game." Cramer rules.


On Apr 10 04:43 AM Fighting Yoda wrote:

> Doing opposite of Cramer is a good strategy.

2009 Apr 10 08:34 PM

[Northstar10000]

The Bull is back. lots and lots of bull. YOu can't follow Cramer. He gives advice on about 20 stocks per night and never does a follow up buy or sell. He covers himself by saying to do your homework. If he can't pick winners what kind of homework can you do that will result in consistent profits. In a bull market he has more winners than losers but so does the average dart thrower.

2009 Apr 10 09:33 PM