Mad Money

Cramer: Why the markets shouldn't have rallied

What's making Cramer so angry
What's making Cramer so angry

Jim Cramer shook his head in anger on Thursday morning when he saw that the Dow Jones industrial average opened up 250 points. It's not that he wants stocks to go lower; it's that the Dow was up for all of the wrong reasons!

Cramer liked the downturn on Wednesday, because that made sense. The fact that the market opened up on Thursday because of the Chinese stock market means that it was based on nothing that happened in the U.S. and therefore had zero staying power.

"I get upset when I see that we are now taking our cue from the Chinese stock market, and when they rally, we open higher, until the sellers come in knowing that they have been given a gift. The gift of higher prices for all stocks, a gift that's frankly undeserved," the "Mad Money" host said. (Tweet This)

What is making Cramer so angry? The setup.

Traders work on the floor of the New York Stock Exchange.
Lucas Jackson | Reuters

When Cramer refers to the setup, he means that the stock market is being driven by forces beyond the control of CEOs who run companies. He outlined each annoying force that is ticking him off.

Annoying force No. 1: As soon as any sort of strong economic data comes along in the U.S., some Fed official crawls out of the woodwork to say that rates should be raised and the market plummets.

Annoying force No. 2: The complete inability for European authorities to solve the Greek fiasco in a timely fashion. This nonsense has been going on for far too long now. It has been five years of failed austerity, and that's pretty insane to Cramer. Now he is hearing we will get a resolution this weekend—he'll believe it when he sees it!

"The longer this Greek tragedy drags out, the worse the uncertainty becomes, and uncertainty equals sell," Cramer said. (Tweet This)

Annoying force No. 3: Cramer was worried that the media wasn't focusing on China enough, but then today he saw a story on it on the front page of the New York Times and knew it was finally getting the attention it deserved.

The fact is that Cramer sees investors in a world where the S&P 500 futures are trading parallel to China. That means on Friday investors could wake up and see the market down 7 percent just because of China.

Additionally there are several American companies that are tied to China, such as Apple with its huge iPhone sales, and GM, which sells more cars in China than in North America.

Read more from Mad Money with Jim Cramer
Cramer Remix: How China's fall impacts you
Cramer: Buy, buy, buy! A rare opportunity
Cramer: Apple is China's biggest victim

So, what can investors do to protect their portfolio amid a horrendous market setup?

Cramer gave his blessing on a few stocks that can both protect and defend, such as Walgreens Boots Alliance, PepsiCo and T-Mobile.

"I hate up openings when the setups are fluid and negative, and if we get them you need to sell, not buy," he said.

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