Cramer Says Shares ‘Still Heavily Oversold’ Even After Big Wall Street Rally – NBC10 Philadelphia

  • CNBC’s Jim Cramer said on Thursday that trying to get into the stock market mindset “can be difficult to understand,” especially with recent volatility on Wall Street.
  • Cramer said there was simply “too much negativity” in the market heading into Thursday’s session, “which made it easier for stocks to rally.”
  • However, if omicron is worse than the delta Covid variant, the host of “Mad Money” said, “then we will regard today’s optimism as a temporary condition of madness.”

CNBC’s Jim Cramer said on Thursday that trying to get into the stock market mindset “can be difficult to understand,” particularly with recent Wall Street volatility over developments surrounding the new omicron Covid variant. “Feeling is a fickle beast,” he added.

The Dow Jones Industrial Average climbed 617 points or 1.8% despite two more cases of omicron reported in the United States on Thursday as the market was open. Five more cases were reported after the market closed. After-hours Dow futures contracts turned negative. The first US case reported the day before took the Dow Jones from a gain of 520 points to a loss of 460 points.

“Investors now seem to be accepting the omicron variant as a new reality. Of course, if this strain turns out to be worse than delta and we start to see a huge wave of hospitalizations, we’ll revisit today’s optimism as a temporary condition of insanity, “Cramer said on” Mad Money “.

But for now, Cramer said there was simply “too much negativity” in the market heading into Thursday’s session, “which made it easier for stocks to rally.” In addition to Wednesday’s drop, the Dow Jones fell more than 1.8% on Tuesday after a brief respite on Monday. Blue chips fell 2.5% in Friday’s shortened holiday session after omicron was discovered in South Africa.

“We’re still heavily oversold,” even after Thursday’s rally, Cramer said, pointing to an S&P proprietary oscillator he’s tracking and the high Vix, or what’s called the fear gauge. “Too much fear means you have to look for purchases,” he said. Nevertheless. the Vix, short for the volatility index of the CBOE, fell 10% in Thursday’s bullish session.

“After a great day like today, some people are going to jump in to sell stocks because they feel like they’ve been lucky,” Cramer said. “What you have to take into account is that there are a lot of others who were waiting for the bombing to end so that they could go further and buy. That’s where we are right now.”

Cramer said the key is to “hold on tight” as high prices could be ahead for what he calls “falling stocks that have suddenly found new life.”

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