Strong stock performance in the high consumer's discretionary space shows the broader US economy "may be in better shape" than investors are led to believe, CNBC's Jim Cramer said Monday.
Cramer, using charts from technician Bob Lang, a colleague and publisher of ExplosiveOptions.net, looked at some of the best names in the consumer discretionary sector. It includes a variety of non-essential goods and services such as motorhomes, cruises, snowmobiles and timeshares.
"It's about as discerning as it gets," the host "Mad Money" said Monday. "This type of stock only works when the consumer is willing to use and the banks are willing to lend."
Cramer said the charts show that things look "very good" for some discretionary shares, indicating that the consumer and the overall economy are in good shape.
example. timeshare company Marriott Vacations Worldwide has grinded higher since it bottomed in early August at around $ 86 per share, Cramer said.
Cramer said the listings indicate the stock may be ready to make a run higher at around $ 120 per share and then perhaps even higher to a high of $ 145 per share. The stock closed at $ 110 per share on Monday.
"It may take some time, but as long as the pattern remains bullish" is where the stock may be heading, Cramer said. "Plus the volume of the balance sheet is very strong, which indicates large institutional purchases here."
Motorhome maker Winnebago, which reported a blowout quarter last week sending the jet, has also recently emptied $ 40 a share to $ 51, Cramer said.
"The moving average convergence divergence or MACD indicator, an important momentum meter, recently flashed a buy signal" on Winnebago, Cramer said. However, Cramer said his colleagues suggest that investors wait for stocks to retreat to around $ 45 before uploading the stock.
The stock was trading around $ 49 on demand Monday.
Cramer also pointed out Polaris, which makes snowmobiles, off-road vehicles and boats.
"This is another that reported strong numbers last week and pushed its stocks into the stratosphere," he said. "Polaris caught a bullish MACD crossover early this month, and it's one of the most reliable signals in the chart."
Cramer spoke after US stocks closed higher on Monday as investors cheered for strong earnings and progress with US-China trading.