Big tech stocks have some “bounce” left in them, CNBC “Mad Money” host Jim Cramer said Tuesday.
Cramer theorized, basing his analysis on chart interpretation by Katie Stockton, that the so-called FAANG stocks — made up of Facebook Inc (NASDAQ: FB), Amazon.com, Inc (NASDAQ: AMZN), Apple Inc (NASDAQ: AAPL), Netflix, Inc (NASDAQ: NFLX), and Google parent Alphabet Inc (NASDAQ: GOOGL) (NASDAQ: GOOG) — along with Microsoft Corporation (NASDAQ: MSFT) are “ready to roll higher,” reported CNBC.
Cramer singled out the stochastic oscillator, an indicator used to measure overbought and oversold conditions on the daily chart mapping of the FAANG stocks.
“FAANG came down too far, too fast, which means it could be due for a continued bounce,” said Cramer.
Why It Matters:
All the FAANG stocks rose, along with the Nasdaq by 0.64%, on Tuesday.
“Whenever Covid cases spike, you had to buy the FAANG names [plus Microsoft] because they’ve all found ways to benefit from the pandemic,” said Cramer.
The former hedge fund manager said investors had his “blessings to buy a little bit” before these companies announce their earnings on Thursday night.
“If they get dinged after earnings, I’m betting that they will be safe to buy into even more weakness,” quipped the television host.