After falling more than 700 points to its lows, the 30-stock index finished the day up about 188 points, or 0.95%, at 20,087.19. The S&P 500 rose 0.47% to 2,409.39, and the Nasdaq Composite rallied 2.30% to 7,150.58.
"This was an important snapback because it gives us a glimpse into the future," the "Mad Money" host said.
Wall Street is steeped in volatility as investors try to digest developments in the coronavirus outbreak and its potential economic impact. Bullish trading will follow any news that seems positive, Cramer said.
"I'm just saying that the bull's out there, he's hibernating, but if you provoke the darned thing, it'll wake up and gore the bears," he said. "With any good news on the coronavirus front, that bull's going to stampede."
He attributed Thursday's action to hope that scientists will discover if existing medicines can serve in lieu of a cure or treatment to save people from dying of COVID-19, the disease caused by the fast-spreading virus. President Donald Trump announced earlier in the day that the U.S. Food and Drug Administration would investigate whether a malaria drug can be used as a treatment. Biotech giant Regeneron is experimenting with an arthritis drug to see if it can treat symptoms.
The market also bounced because it was "insanely oversold," Cramer said, citing a minus-24 read on the S&P oscillator, a lower measure than during the 1987 crash, and the renowned technician Larry Williams.
"That's why, as I said yesterday, it's too late to sell. At this point, if you want out, you've got to wait for more of a bounce," Cramer said.
"[S]o many companies were priced for bankruptcy yesterday that they were due for a bounce," he said.