Stocks are not hitting a top, and they are not hitting a bottom. For Jim Cramer, they are in a trough.
A trough indicates that the numbers for a company have finally bottomed, which was a major reason for stocks to rally recently. Cramer explained it through the use of Tina Turner, who in her version of "Proud Mary" said there are two ways to get the job done: the rough way, or the easy way.
"Unlike Tina, who says 'we never do nothing nice and easy, we always do it nice and rough.' Not me. I like it easy. I look at the stock and it tells me whether we have hit trough numbers," the "Mad Money" host said.
At first glance, Goldman Sachs reported a number that was absolutely hideous to Cramer on Tuesday. Given that Goldman had fewer employees and expenses reigned in, Cramer could only conclude that there was a ton of employees doing a lot of work.
In pre-market trading, the stock plummeted. After the opening bell, the stock began its upward ascent.
"A stock that rallies after that putrid quarter is a stock that says, look at me, the worst is over, get on board because we're ready to roll up river," Cramer said.