There are four major hurdles all investors need to overcome right now, Jim Cramer said Tuesday, but anyone who does so effectively stands to gain.
“If it was just one hitch, we’d be fine,” Cramer explained. “But with four of them, everyone suddenly wants to sell in May and leave.”
For starters, there’s the Fed’s meeting on Wednesday, which will likely lead to a quarter-point rate hike — but it’s unclear whether the Fed will slow down on its aggressive tightening after that, he said.
There are also employment numbers coming out of the Labor Department, Cramer says, which will have to remain flat or fall for the Fed to stop tightening for good. While this may eventually happen, it is not expected to happen on Friday.
Then there is the debt ceiling crisis: Treasury Secretary Janet Yellen told Congress on Monday that the United States could default on its debt by early June. Cramer expects the crisis to be resolved in due course, but there could be a hangover from the market over the next few weeks.
Finally, there’s Apple, which reports earnings on Thursday. Kramer added that Apple’s stock has moved significantly, and the quarter will likely have to be stellar for it to continue moving in the same way.
“Now, it would be much easier to address all of these issues if stocks were lower, and that’s what happens,” Kramer said. “It’s not a bear market, it’s just a time lapse, and you have to realize that these four hurdles are a gauntlet, a real challenge, to be traversed.”