Strong equity performance in the high-end consumer discretion indicates that the broader US economy "may be in better shape" than investors have led to believe, Jim Cramer told CNBC.
Kramer, using diagrams by Bob Lang, a colleague and publisher of ExplosiveOptions.net, looked at some of the most popular names in the consumer discretion sector. This includes many non-essential goods and services such as car houses, cruises, sledges and watches.
"This is as discretionary as it gets," the Crazy Money host said Monday. "This type of stock only works when consumers are willing to spend and banks are ready to lend."
Kramer said the charts show that things look "very good" for some discretionary stocks, indicating that the consumer and the overall economy are
August to about $ 86 a share, Kramer said.
Kramer said the charts show stocks could be ready to make a run up to about $ 120 a share, and then maybe even higher to the all-time high of $ 145 per share.
"It may take some time, but as long as the model remains bullish," the action can be handled there, Kramer said. "Plus, the balance sheet volume is very strong, which shows the main institutions buying here."
Coin-maker Winnebago, which reported a leaking quarter last week that sent its shares in flight, also recently cleared $ 40 a share all the way to $ 51, Kramer said.
"The moving average convergence of divergence, or MACD indicator, an important indicator of inertia, was recently flashing a buy signal," said Kramer. However, Kramer said his colleagues are offering investors to wait until the stock is pulled up to about $ 45 before stock loading.
The stock is about $ 49 when shopping after Monday.
Cramer also referred to Polaris, which makes snowmobiles, motor vehicles and boats.
"This is another who reported strong numbers last week, shooting his stock in the stratosphere," he said. "Polaris caught a bullish MACD crossover earlier this month and it is one of the most reliable signals in the ranking."
Kramer speaks after US stock closed higher Monday as investors cheered on the strong earnings and advances of US China trading.