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Cramer: Media stocks ready to explode higher

Last earnings season, Disney reported a less than perfect quarter, which triggered a downward spiral for the entire media complex in the blink of an eye. Since the bottom in August, Jim Cramer saw many of the media stocks bounce back and continue to roar higher.

So, with Disney reporting again on Thursday, Cramer thought it would be worth circling back to the group to see if it can stay on fire going forward. That is why Cramer turned to Bob Lang, a technician and founder of ExplosiveOptions.net and colleague of Cramer's at RealMoney.com.

In short, Lang's view is that the media plays are red hot right now with beautiful charts. He thinks some of the stronger names are ready to roar even higher.

In particular, Lang likes media stocks that have made higher lows and outperformed the market since the double bottom in the averages in late August and September.





"Based on the charts, he [Lang] thinks it's clear that the big boys have been buying these names for weeks, making the media and content plays one of the best performing groups in the very strong month of October," the "Mad Money" host said.

First up on the list was Disney, and according to Lang, this stock is clearly headed higher. Not only has the stock rallied since August, but it also made a higher low when the market sold off again at the end of September. Given that the stock closed at $116 on Tuesday, Lang thinks it could go above $121 soon.

Lang then took a look at the daily chart of CBS, which reported after the close on Tuesday. CBS is Lang's favorite name in the group. Not only has the stock made a higher low since August, but it broke out to the upside on high volume last week.

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The best part about the charts for CBS was the inverse head and shoulders formation. This might sound like an upside down bottle of shampoo, but it's actually one of the most reliable bullish patterns that a technician can find on a chart. This pattern led Lang to believe that it will be smooth sailing for CBS until $52, and then there will be a bit of resistance.

The last media stock on Lang's radar was Netflix, which was slammed after it reported subpar domestic-subscriber growth last month. Lang thinks that if Netflix can rally above its recent high of $116, then it will go back to its all-time high of $129.

Ultimately, the charts suggested to Bob Lang that media stocks are on fire right now, particularly Netflix, Disney and his favorite, CBS.

"Disney reports on Thursday, but given all of the good things that are happening at this company, I think you have to view any potential earnings related weakness as a buying opportunity for the long term," Cramer said.

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