Ponsi noted that just as the XLB was breaking out from its powerful ceiling of resistance, it made one of the most bullish patterns ever in a chart, known as a golden cross. This is when the short-term 50-day moving average crosses above the long-term 200-day moving average.
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"It's the kind of thing that technicians tend to salivate over," Cramer said, "If you want a sign that the basic materials group is now very much in vogue on the Wall Street fashion show, a breakout past long-established resistance, coupled with a golden cross is about as good as it gets."
An example of a basic material stock on fire is Alcoa, the aluminum company that is about to break up into a pure play on metals and a play on engineered products for light-weight cars, trucks and airplanes. Alcoa's chart recently displayed an inverted head-and-shoulders formation, which is one of the most bankable patterns in technical analysis.
"The vast majority of the time you see this kind of a pattern, it signals that we are going to get a big move higher," Cramer said.
Additionally, Eastman Chemical's stock roared higher on Tuesday. It showed the same golden cross and MACD buy signals as the basic materials ETF and Alcoa. Ponsi was very enthusiastic when he saw Eastman Chemical break out of a cup-and-handle formation, too.
The cup-and-handle formation is an extremely bullish pattern, where the stock makes a cup-shaped bottom and then trades sideways to create a handle. Typically, this pattern means the stock is ready to rocket higher, which Ponsi predicts for Eastman.
"The real takeaway from this rally in the basic material plays is that these stocks only behave this way when we are entering into the early-to-middle stages of an economic expansion," Cramer said.