Wednesday Night's Show Highlights:
Important technicals from the charts indicate that we should stay away from these five commodity-dependent stocks!
Wednesday, May 16, 2012

Cramer's comments: (prev. night's show posted each business morning before the market open)

Jim: You know me... I like to be constructive, and accentuate the positive... eliminate the negative... that sort of thing. Even though I prefer to help you find stocks that are safe to buy into weakness, sometimes it's just as important to lay out all of the stocks you need to stay the heck away from.

 

That's why, tonight, we're doing a very special "Off The Charts" version of the Sell Block, with the help of Carolyn Borodin, a terrific technician who's been very right... because we've got to show you how dangerous the commodity stocks can be in this environment... and they are dangerous. Just because they've already been crushed by the commodity collapse doesn't mean, as we've learned before, that they can't be crushed some more.

I may not be a chart guy. I'm a fundamentalist, meaning someone who doesn't put much stock in the charts, and instead invests based on how the underlying fundamentals of the company are doing. But even I acknowledge that it's important to know when the charts are going against you... when the trend is not your friend... when it is your worst enemy. And no surprise, according to Borodin's work, that's the case right now in the vast majority of commodity-based stocks... even some that I consider best of breed. There may be some areas where these stocks can bounce, but for now, Borodin says the path of least resistance calls for lower prices. And as you will see in a moment, these stocks are pretty much all tracking together as if they were one stock...

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