Starts next week. Despite the propensity of everyone to believe that the only thing that matters is the fed, i have news for you. Next week is earnings week and sales and earnings are individual companies are a lot more important than you think during this one period. Yes. Isolation give a number here, strong nike report, good home depot quarter. It can move a stock. They may not get in this market any pin action though. But 12 weeks a year the three weeks each quarter that i regard as official Earnings Seasons they can matter to the entire market. I want you to consider them the playoffs and all the rest are just regular season games. I have to give the macro data its due. Just like the employment report. So on monday we get the nonmanufacturing number. This is the lone number left that i think is still strong. I say that to all the fed people who want rate hikes so badly. This is it. Only one. So you better get this right. Were a service economy, if we see that slow down, but the fed will be nuts to raise. That doesnt bother them. You know my view. The fed has to fish or cut bait. Either raise rates this month or shut up about them next year. Anything else is torture. Stop torturing us. Thats a one companies thats the biggest disappointments out there and maybe the Container Store will pull a ran bit out of the hat. It comes under the category of going so low that maybe, maybe itsy teeny something is positive. Stocks do bottom if they beat even all already slashed estimates so why dont we use the Container Store as a metaphor a model of what can happen if numbers are better than anything already cut. Thats the continued theme during the earnings season. Im excited about tuesday. First pepsico reports. This is a miraculous time for this company. Even as its stock has done nothing. Maybe that can change when we see how well the company doing in the amazingly low cost commodity environment. When you make all the right moves as they have under the ceo, its been the best organic grower in the group. Eventually something good will happen. Maybe it will be tuesday. Then we hear from yum brands. Heres another company thats doing well. But if stock has suffered from activist fatigue where the owners, bedraggled shareholders are worried about their franchises and keep selling for not anything to do with the company. Just has to do with their own internal Money Management problems. Yum stock will be a bargain, why . As much as we denigrate china, the Chinese Consumer is still spending. We have heard from apple, nike, so isnt it time for kfc to get the mojo back . Either way the stock is cheap. I would buy it if it gets hammered today, i would buy it for the earnings on tuesday. You know what might be the best thing that happens tuesday . Analyst meeting for adobe which is successfully navigated the waters to become a Subscription Company like red hat or salesforce. Com. I want to own it ahead of the meeting because i think the story is going to be terrific and we reported that monster good quarter. We have some macro news out of germany this time. The Industrial Production number. Were at a a point that europes economy rebounds. If we dont get it were stuck with that dollar that will keep going higher and higher and thats plain bad for all of the internationally oriented companies. Im paying especially close attention to this number and to the trade bounce figures that comp out on thursday. 70 of the business is related to cars and the exporting and the Worlds Largest auto company, volkswagen, has i dont know, what would you call it . A problem. All right. Wednesday we get results from one of i many absolute Favorite Companies with a stock nothing short of miraculous. Thats Constellation Brands. They have a hammer lock on the two major brands of beer, what dell low and corona. And i can tell you from my other hat, as the owner where i proudly hosted a fundraiser for the navy s. E. A. L. S on sunday, this is pure gold. Constellation had an amazing year. The last time it reported the stock got hit bad, right after it reported. E, is though it was even though it was a beautiful quarter. I wandered the wilderness before igniting again. I think we have to bet this is going do the same thing. Dont buy it ahead of time. What well do, the well, small if you want to it. Heres one thats down on the luck. Monsanto. I keep hearing there will be more number cuts from the company because its linked to the price of grapes write is going down. R riyal is called a currency. Is this where the antigmo people have hurt Critical Mass and hurt the stock . You know theyll say theres a genetically modified rebellion going on. I dont know if its this quarter or this year but the stock is off very big already. And you know what . If it goes up at all, if it shows any strength i would exit skeedaddy. Thursday, dominos. When i talked to managers about the stock, money money manager never find anyone who loves their pizza. I love their pizza. Dominos under ceo patty doyle has been nothing short of a nightmare for anyone who bets against them. Its a Technology Stock and pizza drag. Thats been the secret behind the fabulous growth. Theyre a remarkable worldwide franchise. The one in mexico is dynamite. This stock like Constellation Brands have sold off after good numbers almost every time. I suggest you wait until after the quarter if you want to own it. I think you should. Doyle as i say in get rich carefully is bankable. After the close, thursday comes oh, boy. Heres controversy. Alcoa. By the way the bonds were updated this week. I think that alcoa is not getting its due for the amazing breakup into the two companies. A higher value added products play and a low cost commodity maker. This is what people have been waiting for. And i think that the two pieces are going to produce terrific returns maybe even both of them will go up. Although obviously i like the value added business more. Thats one point at the downside of alcoa and four points up. I caution, you may get that point down first. Finally, friday is a white day. But well get a shareholder meeting. One of the most disappointing stocks this whole year, the 3d printer company. I wanted to put this in front of you because 3d was a craze, a cult. People used to show me how 3d printing worked and it ended with a bang. That is exactly what can happen when cold stocks check your portfolio, hit the wall. Its what this market has become. For so many high fliers. So heres the bottom line. Brace yourself, we are plunging into the earnings playoff. They will matter. They always do. Patrick in texas. Patrick caller hey, jim, how you doing . Good. Caller im long alibaba, where do you see it . I see you to pick up something, im not a fan of alibaba. When they go higher, sell sell sell sell. Lets go to ken in new york. Ken . Caller thank you for taking my call. Im in the house of pain with t. H. Oh, boy. Caller i had it for a long time, in the retirement account. I dont need to need it for at least five years but the recent losses have been substantial. Should i stay in or cut you know, these stocks that are that have been down around 25 i cant tell you to sell them. I cant. Its an International Industrial company, those are the worst things to own right now. Being lumped in with caterpillar. I think its doing a lot of things right. I cant tell you to sell it. But i cant tell you to buy it. Nomansland. Eric in new york, eric . Caller hey, jim. Big booyah to you. Thank you. Caller i wanted to thank you for taking my call. And also for all of the years of great investing advice. Appreciate it. Caller more specifically, i was wondering how you felt about the bank of america stock and the overall Big Bank Stock okay. Im glad you asked. Heres the story with bank of america and wells fargo, huge problems for action alerts. Com. Thats my Charitable Trust. We send out bulletins. These are two companies uniquely levered to the feds raising rates. You need something in your portfolio that works when the fed starts raising rates. I think the bank of america is going to work better than any other bank. Is it the the best in america . No. Will it do the best if the fed raises rates . I actually think yes. Announcer dont miss a second of mad money. Follow jimcramer on twitter. Have a question . Tweet cramer, madtweets. Send jim an email to madmoney cnbc. Com or give us a call at 1800743cnbc. Miss something . Head to madmoney. Cnbc. Com. What do you got to offer us today . Balance transfer thats my game bank you never heard of, thats my name haa thank you. Uh, next. Watch me make your interest rate. Disappear. Theres gotta be a better way to find the right card. Whatever kind youre searching for, creditcards. Com lets you compare hundreds of cards to find the one thats right for you. Just search, compare, and apply at creditcards. Com. A one, a two, a three percent cash back tonight im letting you on Something Real big. The method of my madness. Come on, i know this is the craziest and most random thing not only on tv but in business in general. Think about it, a show about business . I know you wont find investing advice this good anywhere else. You know that too or you wouldnt be watching. Unless you tune in to see if tonight is the night that i actually do the walk around. Which after multiple years of airing theres a possibility of that any given night. Sorry. Theres a tape delay. Keep wishing. I do my best so it doesnt. This show is about the method or methods to break from strictly quoting the bard to my madness. How do i pick the stocks . What gets on the show . Why do i tell you some stocks are worth buying you or on the dip or instead of hey, how about tomorrow . Tonight ill give you pieces of the answer. One of the easiest ways i identify potential cramer names the stocks that cant or wont necessarily end up on the show, is by watching my favorite list from when i was frankly a little boy. In fifth grade. I used to look at the new high list. I thought it was like the guys who were hitting better than. 300 in baseball. Stocks on that list, the highest of the high, obviously have something going for them. Thats true when the market is in bad shape. As only the best of the best can hit new highs when the market is falling apart. What does it tell you . Its either part of a genuine bull market or theres sales momentum or maybe its sector does which is so often responsible for stocks increase. Many stocks on the new high list keep going higher because its really a list of astudents that are worth investing in. They tend to repeat themselves every quarter. Just like the smart kids in school. In a great bull market from the bottom of 2009, and any market by the way that doubles from the bottom has to be considered a great bull market. Even as i know many resist such labels. We saw the new high list over and over again. The same stock that hit new high after new high and following them was a great way to make money even as the bears claim endlessly that the bull market was false and couldnt be trusted. Listening to the bears caused you to miss out on the greatest rallies in history. Obviously the rally is more like the exception than the rule over time. All the years i followed the, what. By generally speaking things have worked well, will continue to work. Because these stocks typically represent companies that are best of breed. Always remember that phrase because its integral to mad money. I am not saying that just so you can chase stock that are hitting the new highs because theyll keep going higher. That would be the ultimate foolishness. Im saying that if you want to id if i stocks that are winners in the future unless theres a big sea change in the market caused by a gigantic political shift or shift in the Interest Rates looking at the biggest winners of the present is a good place to figure out the future. Let this list do it for you. Its already been scrutinized and scrubbed. Thats the thing about the market. Not always that hard to play once you understand that theres often more continuity than change. Things pretty much go keep going the way theyre going. Until something major shifts. And then you do have to alter course. Those course changes can be pretty radical though. Thats why you have to be reevaluating your ideas and should never dig in your ideas when the facts change. Something we emphasize over and over. And all of my books that i have written save my autobiography. Settling scores with myself of course. Hey, it isnt can called mad money for nothing. You know what . When youre looking for stocks to invest in, when hunting for the bull market like i do here, looking at the any high list is a terrific way to begin. I am many things a lot of them negative. But laziness and irresponsible, i dont know. Anyone who sees my insane tweets at 5 04 yes, thats me tweeting. Is that someone else getweeting for you, who else would tweet that early . And then do you ever sleep . Well, no. I apply the same rigors to this show as in the hedge funds. Ill talk about the special circumstances later on the show. Wait for the fabled pull back from the new high list because that is the best place to put money. The pull back and there im thinking of something that could be 2 or 3 or 5 , it gives you a good entry on the list. Remember, im not telling you to chase momentum. You should be conscious of price and therefore try to buy on weakness. Like you want to sell into strength. Most cant pull the tricker when the stock trigger when stock is going down. Im throwing these caveats in though because i dont want you to look at the new high list as the shopping list. Big mistake. Its a jumping off point. Albeit an important one for those trying to get started. Pouring over the new high list is fabulous way to identify potential, i stress that word, potential stocks to buy. Youll only buy if you are confident theyll make a comeback, having nothing to do with the market. Do the same homework. Its not you dont get a pass there. You absolutely must have conviction even if its a cynical conviction that the stock is going higher. I do that for the ipos where im saying that the buyers go crazy about it. I accept theyre pieces of paper. You know the big boys cant resist Growth Stocks and will come to the support on down days. The biggest caveat of all when shopping for stocks that pull back from the new highs, make sure they havent pulled back for a reason. Dont go buying a home builder thats down if Interest Rates flew up because they could initially get hurt for the quarter. By the way, dont buy a big independent oil stock when oil goes down for three Straight Days because that doesnt belong on the new high list anymore. Youre looking for a stock that has bristolmyers like strength. Be certain youre dealing with a damaged stock and not a troubled Company Going down down down. How do you tell the difference . If the fundamentals havent changed, the stock probability hasnt fall probably hasnt fallen from grace. Now more than ever, thanks to the fact that stocks are traded by commodities, causing huge selloffs that make no sense of anything or double and triple the related etfs that are more powerful than the stock themselves you see the Good Companies pull back from the highs for nothing that happened to do at the company. Nothing to do with the company or the strength of the underlying businesses. Those are the buys. Buy buy buy but if the picture changes, then that stock is no longer a candidate. Sell sell sell. The story has to be intact or this method will let you down. While it isnt a hard and fast rule, i tend to like stocks that pull back, just enough, but not too much. All right . I have to tell you, 8 is the historical optimal level that i made a lot of money in. Less than that youre early for some of them. More than that, maybe something is indeed wrong with the stock. You dont know. 3, 5, 8, those are all important level. 8 , i made a killing. Bottom line, thats the first method of cramers madness watch for the stocks that pull back from the high list. Some of the best picks have come out of this process. Its my getting to workshoping list. Hopefully some of yours can too. Why dont we start with arzella in ohio. Caller hi, jim, booyah to you. Booyah right back. Caller im trying to get a better insight on mutual funds and id like to know are they a good way to diversify . Io you know what, heres the problem. A lot of people have 401 k s an you have to have mutual funds and you cant pick individual stocks and for that they are. Im older, 50 growth, the rest will be a balanced situation, maybe a fund that has some bonds. You have to depend on your outlook and age and yes, the mutual funds are good. Stewart in georgia . Caller whats the best time to use stop orders after purchasing a position . We dont do that. We have to Pay Attention to it, and if were not going to trade well invest. We dont need stop orders because what could happen . The market could be down 10 in a down day. We invest on mad money. We aer not trade were not traders we invest. Theres a method to the madness. The first method look for stocks that pull back from new highs especially because of a Broader Market selloff having nothing to do with the individual stock. That you want to pull the triggeren o. Stay with cramer. Mr. Cramer, absolutely love the show. We really appreciate you out there, man. Booyah to my kids, in Elementary School learning so much from you. Booyah, mr. Cramer. I know you hear this all the time, jim, but thank you thank you thank you so much. This has been my best year by far and away in the market. I want to thank you for looking out for the regular guys out there. I am trying to teach people to be better investors and im doing my darn best. Thats the goal here. Great to hear your voice and know that youre here for us. vo me . I dont just wait for a moment. I watch for the perfect moment. The one nobody else sees. And when i find it i go for it. announcer at scottrade, we share your passion for trading. Thats why we give you the edge, with innovative charting and trading features, plus, powerful mobile apps so youre always connected, wherever you are. Because at scottrade, our passion is to power yours. This bale of hay cannot be controlled. When a wildfire raged through elkhorn ranch, the sudden loss of pasture became a serious problem for a family business. F