The Shanghai Composite Index (SHCOMP) will rally shortly after reaching a 2013 low this week, according to Tom DeMark, the founder of DeMARK Analytics, LLC who correctly predicted a retreat in the Chinese stock gauge last month. The measure of domestic Chinese equities will rebound once it falls below 2,232 on March 20 or 21, DeMark said by e-mail today. That would be the lowest level since Dec. 27 for the Shanghai Composite, which declined to as low as 2,232.13 today. The index gained 20 percent over December and January. DeMark, the Paradise Valley, Arizona-based creator of indicators to show turning points in securities, said Feb. 6 that the Shanghai stock index would fall about 8 percent to within a range of 2,230 to 2,250 before rebounding. The gauge was down 8 percent from when he made the call to yesterday’s close at 2,240.02, as slowing manufacturing expansion to quickening inflation cloud the outlook for China’s economy.
“Mad Money” host Jim Cramer discusses chart analysis with the DeMARK Indicators.