CNBC’s Jim Cramer said Thursday that while buying stocks during periods of volatility may not seem like the right thing to do, history often proves that’s exactly what investors should do.
“Sometimes you have to hold your nose and buy,” Kramer said on “Mad Money,” admitting that it’s hard to keep his emotions in check. It’s also tough because short-term losses can be seen before long-term gains. “History tells us that when the average falls too quickly, you need to become a buyer, because when the market is oversold, it always rebounds.”
Cramer’s advice comes after Wall Street suffered a second straight day of losses due to the escalation of the Iran war. of Dow Jones Industrial Average, of S&P500,and Nasdaq Both ended lower, as international crude oil prices rose 1.2% to $108.65 per barrel, but were well away from their worst levels during the session. Brent briefly hit $119 after attacks on energy facilities in Qatar and Iran. Oil prices fell later in the day after Israeli Prime Minister Benjamin Netanyahu said his country supports U.S. efforts to open the Strait of Hormuz, a vital Middle East waterway for oil shipments that Iran has vowed to remain blockaded.
To identify these historical buy signals, Kramer uses the S&P Short Range Oscillator. It’s a momentum indicator he’s relied on for decades. As of Thursday’s close, the oscillator remained oversold for eight consecutive sessions. In the case of CNBC Investment Club, Mr. Kramer is looking to buy oscillators when they are this oversold. Club members received trade alerts for two stocks around noon. (Mr. Cramer is looking to lock in profits in an overbought market not seen since July 2025.)
“I’ve been studying this oscillator since 1987…and it’s rarely led me wrong. When you go to buy into an extremely oversold market…in the next 30 days, it tends to start buzzing like bandits,” Kramer said. Cramer said he sees an even more severe oversold pattern in April 2025, with the S&P 500 rising 30 days after President Donald Trump’s “Emancipation Day” tariff announcement.
“History shows that when this gets oversold, meaningful rallies occur and things persist,” Kramer said. “I’m going to follow history. It’s too stark and too accurate to do otherwise.”
