Cramer: True Bounce

Tickers in this article: ETN IBM MMM PPG SBUX

This article originally appeared on April 29, 2013 on Real Money . To read more content like this + see inside Jim Cramer's multi-million dollar portfolio for FREE. Click Here NOW.

The bounce. Is it back? I think we have to watch the stocks of 3M, IBM, United Technologies , AT&T, Starbucks and Amazon today because we need to see if they follow-through with the bounce that we have seen from disappointments.

The disappointments of the quarter may be legion, but the stock recovery after the disappointments has been terrific. We thought that JPMorgan Chase and Wells Fargo were disappointing at the beginning of earnings season, but they have performed just fine since their reports. Eli Lilly was supposed to be weak after the quarter, but it has begun to bounce back well. Target preannounced a weak quarter, then bided its time, and then went above where it was.

Intel was supposed to be the worst of the worst but you needed to buy it immediately upon its decline. Caterpillar, of course, is up since it reported a number that spurred many an earnings cut.

Amazon in particular is worth watching because the stock's been charmed when the company reports bad numbers. Sometimes we get a bounce intraday. Other times it occurs a few days later, like today.

At the same time, something positive's afoot with IBM. Was the swoon overdone? Is Warren Buffett in there buying hand over fist? Could be. It would make sense if you really believed.

I am still trying to figure out what people didn't like in Starbucks. I thought the initial take, which was a run up to $62, was correct after reading the quarter. But it has been a big winner.

The weaknesses we have seen have proven to be ephemeral. Why is that? I think it is because people feel that Europe is bottoming even as only a couple of companies have said that's the case.

I think tonight's interviews on Mad Money with Eaton -- nice bottom line, so-so top line -- and PPG will tell a compelling tale. Any sign of any bottoming would explain much about what's going on in those stock markets over there. And it could provide an underpinning for all of these bounces, and the bounces yet to come.

My take is to buy the big declines, not sell them, and then when you do get the bounce, you have to lighten up. The declines are proving to be the overreactions, and the advances from those levels seem logical given that the second half might just turn out to be better than the first.

At time of publication, Action Alerts PLUS , which Cramer co-manages as a charitable trust, is long ETN, IBM, JPM and UTX.