Tom DeMark: "Today Is An Interim Low" Followed By A 5-8% Rebound, Then Another Selloff; China To Fall Further

Tyler Durden's picture

There are not many technicians that Steve Cohen has on speed dial, but Tom DeMark, whose indicators grace the default graphs of many Bloomberg terminals around the globe, is one of them. One reason may be DeMark's recent track record, having called a "Sell" on November 3 which was close to the all time high in the S&P, shortly after which US indices tumbled leading to the worst start of the year in history hitting DeMark's targets well ahead of time.

Earlier today, just as global stocks entered a bear market, DeMark spoke with Bloomberg TV, and may have been one of the catalysts for today's violent surge off the lows just as the Dow Jones was crashing by over 550 points, when he said that "today may have been an interim low" highlighting that the intensity of the decline is comparable to the plunge in November 2008 and August 2011, both of which were followed by reflex rallies of 5-8%, roughly the same as what he expects now:

We think it could be a pretty good rally off that low; We're going to have a two-step affair: a low today, maybe tomorrow and then we rally and people take a deep breath. After we see that rally, maybe anywhere from a week and a half to three weeks, we decline again and I think that's coincident with the Shanghai Composite and the Hang Seng Index declining.

Incidentally, he said this just around noon when stocks were at their lows, so he did not have the benefit of hindsight from the market close. However, this good news for US stocks if only in the short-term, will not be shared by their Asian peers: DeMark discussed the Hong Kong and Chinese market, and sees those as continuing their fall:

We are pretty confident the next level on the HSCEI is below 7,500. We think what we're going to see in the HSCEI is four consecutive, maybe five, lower closes and that should bottom that market. We should get down below 7,500 and the Shanghai Composite we should still get down to objective which is about 2,500-2,600.

DeMark then reveals why at this point a central bank intervention, which gratifying in the very near term, would be the worst possible outcome for a stable, long-term rally in stocks:

Markets bottom when the last seller has sold and markets top when the last buyer has bought. We are looking for a bottom that's a secondary bottom where you make one bottom, you rally, make a lower low and the internals of the market show that there's strength and at the same time when we make that low there's a low of negative news: we don't want to see positive news from the government; we don't want to see positive news from central banks. That interferes with the rhythm of the market.

Finally since this was a typical soundbity finTV interview in which the anchors always have to know what, if anything, the interviewee is buying, we found DeMark's answer to be wonderfully laconic:

If I were a long-term buyer, I'd wait. Today we got -2,500 net declines in the NYSE. We'll rally, we'll make a lower low, and maybe we do -1,500 for a few days which would be a divergence and indicates that we are probably at a bottom. We could recover 40% of the decline subsequent then to that but we do have a lot of damage done to the market long-term.

The interview took place just after noon, which may explain why the Steve Cohens of the world bought today's massive dip and sent some of the most shorted stocks soaring in an epic closing dash for trash.

What happens next? DeMark could well be right, however his call for a rebound has been consensus for the past few days, and ironically the reason for today's sharp decline may have been that everyone was expecting stocks to jump which may explain why they did precisely the opposite.

In any event, look for the next few days to see if DeMark still has his magic. We, on the other hand, would rather wait for "Gandalf" Kolanovic' next take.

Full interview below:

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Tinky's picture

Executive Summary: Technical mumbo jumbo.

Any questions?

espirit's picture

MSM shills are screaming 'don't panic' over losing 10% 401k value.

Hope those fuckers jump when it hits 20%.

Boris Alatovkrap's picture

Too many is numbers and analysis for Boris, but where is picture of Monica Lewinsky!?

tarabel's picture



Check your file of old screensavers.

Divided States of America's picture

I dont know about this Tom DeMark guy, he has been pretty OFF The Mark with all his calls. I remember the last time the market sold off bad and he said it will continue and boom the markets pulled a Gartman on him and went to new highs. Its hit or miss with him.

Bilderberg Member's picture

"...we don't want to see positive news from central banks. That interferes with the rhythm of the market."

Interpretation:  Any good fed news is fake and manipulated.

power steering's picture

Tom says higher then lower, then lower. lower , much lower. Tom DeMark knows more than you do. I for one trust his analysis over all others esp. free flyers.  T Demark has an extrodinary record. I wouldn't be in this stock market if I were you, but then I'm not you and you're likely busted in bitcoins too Carefull Buds

Otrader's picture

With every call these mkt technicians make, they are right about 50% of the time.  I think 82% of zhers already knew that.  And, I'm 100% certain his current mkt projections isn't worth shit. 

order66's picture

Not before we head back to that low.

umdesch4's picture

Yeah, I was talking to some people today, and I had the SHCOMP graph on my screen. I held a ruler up to it, and said "see, looks like 2500-2600 is where it'll probably drop to soon". I guess I'm a fucking genius like these assholes.

Bangin7GramRocks's picture

Go back to selling condos in Wildwood! What makes these cum guzzlers think they can predict the future with such certainty? It truly is a sign of a sociopath and should be used as evidence to commit assholes like this.

Boris Alatovkrap's picture

Boris is funny story about condo. One time is host birthday party for daughter and friend and is want to make animal sculpture, but is forget to buy balloon...

Never mind, now is not so funny when think about it.

prefan4200's picture

Goddamn, Boris, your posts are just the best.  I can always count on a really good laugh.  To your health !!

Wahooo's picture

Alright, I'll bite. You didn't have a balloon somwhat did you use?

bfellow's picture

Thought we we're blaming the midday rebound on China's PPT. To quote the old, haggared bitch, "What difference does it make?". At the end of the day, this all goes to shit anyways. Even Wile E. Coyote hit a few plateaus falling off the cliff. 

junction's picture

DeMark is only as good as his last prediction.  The massive dump in stock prices this morning means one thing: the world's economies are on the ropes.  Things are so bad that the Saudis have cut back their monetary support for ISIS.  ISIS will have to ramp up its production of Captagon methamphetamine pills to make up for the cutback in Saudi aid, something that will make ISIS's drug dealing partner, the Bush crime cartel, very happy.  The first target of Russian Kalibr cruise missiles from the Caspian Sea ship launch platforms was the ISIS Raqqa Captagon drug facories, which infuriated Jeb Bush.  Back to DeMark, he is just whistling Dixie, the bent U.S. stock market is beyond rehabilitation, the markets will yo-yo down to 14,000.  As the markets sink, Obama will try to distract Americans as their retirement plans get pounded by staging another monthly false flag attack, this one probably in Florida.   

Soul Glow's picture

The crash will begin in March....

Tegrat's picture

3/22 skull n bones? Daniels Timeline said 3/22/13 was a big day, some said Obama fufulled prophecy (abomination of desolation at the Bethlehem temple). Not sure where you/others get that date...

Chupacabra-322's picture

3+2+2+1+3 = 11. These Pure Evil Lucerferian Scum Fucks really love their numerical symbolism Devil Horns.

tarabel's picture



But that's actually a 2, not an 11.

Yen Cross's picture

 You gave the bald Mythic " Red Eyed" devil dog a >2?

 just having fun before the next leg down. lol

Mr.Sono's picture

What's your prove? My 8th ball is not working

Bangin7GramRocks's picture

My Glenfiddich is working just fine.

prefan4200's picture

So is my Glenlivet, my friend.  I like your style.

Nobody For President's picture

I upvoted both of you fine lads - I enjoy (irresponsibly) both these fine waters of life. I drink the Glen to celebrate the days I make fiat on the 'market', and the Valley of the Deer to comiserate on bad days.

Today I had an apres ski (ok, apres snowboard) Mimosa- it was kinda that kind of day...

gmak's picture

has he ever been right?


And, what smart money buys that much on some other guy's say-so? None I have ever known. Thye do their own work - none buy because of some technical mumbo=jumbo.  Now, if Kevin Henry woer to call and let drop that Citadel was on the prowl....

Chuckster's picture

If he is right and there is a rally....perfect time to short.  Is he right? me.

Chupacabra-322's picture

From RT:

The House-approved bill mandating increased security checks on Syrian refugees was blocked in the Senate, after failing to win enough support to clear a procedural vote.
The SAFE Act of 2015, also known as House Resolution 4038, needed 60 votes to advance in the Senate on Wednesday, but received support of only 55 lawmakers, with 43 opposed.

Passed by the House of Representatives in November 2015, the bill would have required personal guarantees from top US security officials that the Syrian refugees being resettled in the US posed no terrorist threat.

Many Democrats have slammed the Republican-backed bill as a xenophobic attack on President Barack Obama’s refugee policy. Prominent Democratic lawmakers argued that its requirements would “incapacitate” the US security apparatus worse than Islamic State (IS, formerly ISIS/ISIL) terrorist ever could.

After an acrimonious debate, 48 Democrats joined 241 Republicans to pass the bill in the House.

Six Democrats needed to back the bill in the Senate in order to close the debate and clear the way for the floor vote, a motion known as cloture. Procedural votes are generally seen as a matter of party discipline, however, and very rarely result in defections across the aisle.

Minority Leader Harry Reid (D-Nevada) offered to support the cloture if the Republicans agreed to vote on two proposals put forth by the Democrats, reported The Hill. Reid’s bills sought to ban firearms sales to individuals on US terrorist watch lists, and condemn GOP presidential hopeful Donald Trump’s call to bar Muslims from entering the US.

db51's picture

Just look at that fat necked fucking sleazeball.   WTF.   I wouldn't believe anything that came out of his fucking pie hole.   What size rope do you need to fit around that fucktard's neck?   Hang em high....short rope.

Mark Mywords's picture

C'mon now! Have some respect. He's a job creator.

Bow to his greatness.

Bangin7GramRocks's picture

Fat necked fucking sleazeball is pure poetry! I bow down to your killer prose!

milking institute's picture

Nice hairpiece though,you can't even tell!  lol

Nobody For President's picture

Hairpiece?! Thanks! I thought it was painted on.

Vlad the Inhaler's picture

Stocks will go up one more time in the short term, but let's call it what it is, a dead cat bounce not a rally.

db51's picture

^^^^^^^^^^^^^What she said.

anonnn's picture

Note that China deval of its currency may take a different form than the usual change relative to another [fiat] currency.

E.g., an actual game-changer may occur, where something other than a fiat currrency is introduced. At this time , all currencies being fiat means all of them are simply promissary notes also known as I.O.U.s, that are only paper .

Until a promissary note or IOU is convertible into an actual object of value or a valuable service, the debt is never actually extinguished.

That is why payment of gold or silver or other agreeable item/service made possible a more self-regulating system where flim-flam and blind/unverifyiable trust were not easily abused.

anonnn's picture

See this proposal for deval rel to gold, not USD:




"Will China Play The 'Gold Card'?


Hugo Salinas Price



Alasdair Macleod has posted an article at which I think is important.

(See "Credit deflation and gold".



The thrust of the article is that China, at some point, will have to revalue gold in China; which means, in other words, that China will decide to devalue the Yuan against gold.


Since "mainstream economics" holds that gold is no longer important in world business, such a measure might be regarded as just an idiosyncrasy of Chinese thinking, and not politically significant, as would be a devaluation against the dollar, which is a no-no amongst the Central Bank community of the world.


However, as I understand the measure, it would be indeed world-shaking.


Here's how I see it:


Currently, the price of an ounce of gold in Shanghai is roughly 6.20 Yuan x $1084 Dollars = 6,721 Yuan.


Now suppose that China decides to revalue gold in China to 9408 Yuan per ounce: a devaluation of the Yuan of 40%, from 6721 to 9408 Yuan.


What would have to happen?


Importers around the world would immediately purchase physical gold at $1,084 Dollars an ounce, and ship it to Shanghai, where they would sell it for 9408 Yuan, where the price was formerly 6,721 Yuan.


The Chinese economy operates in Yuan and prices there would not be affected - at least not immediately - by the devaluation of the Yuan against gold.


Importers of Chinese goods would then be able to purchase 40% more goods for the same amount of Dollars they were paying before the devaluation of the Yuan against gold. What importer of Chinese goods could resist the temptation to purchase goods now so much cheaper? China would then consolidate its position as a great manufacturing power. Its languishing economy would recuperate spectacularly.


The purchase of physical gold would take off, no longer the activity of detested "gold-bugs", but an activity linked to making money, albeit fiat money. Inevitably, the price of physical gold in Dollars would separate from the price of the "paper gold" traded on Comex and go higher, leaving paper gold way behind in price.


If the US were to provide the market with physical gold in the quantities being purchased for trade with China, it might be able to prevent the rise in the price of gold in Dollars; however, we know that Comex has only one ounce of physical gold for every 124 owners of paper gold, so that action would be impossible. China would be sucking up the world's gold at a huge rate, if the price of gold in Dollars were to remain where it is at present.


The only way that the US might counter the Chinese move, would be to revalue gold in Dollars; which is to say, the US would have to effect a corresponding devaluation of the Dollar against gold, to nullify the effect of the Chinese devaluation of the Yuan against gold.


At a Dollar price of gold of $1,517 Dollars per ounce, the Chinese devaluation would be left without effect: the present Yuan/Dollar exchange rate would then remain at 6.20 Yuan per Dollar: 9,408 Yuan/6.20 exchange rate = $1,517 Dollars per ounce.


This is the old policy of the 1930's, commonly known as "beggar thy neighbor", where countries carried out competitive devaluations against gold in order to preserve their manufactures and continue exporting. The response of importing nations was to raise tariffs on imported goods. (Say good-bye to an integrated world economy.)


Will China decide to "beggar its neighbors", the US and Europe? I think that the huge problem of keeping the Chinese economy on its feet and avoiding the political instability which would rage through China by not doing so - with a population in excess of 1.3 billion human beings - will be so compelling that China will practically inevitably resort to raising the price of gold in China.


When might this happen? The world economy is going from bad to worse by the day. The Chinese may opt for this measure out of sheer desperation, and it may be a reality soon. I have the sensation that things are falling apart around the world at an increasing rate of speed. Perhaps China will move this Fall?


Devaluing the Dollar on the part of the US would upset the apple-cart of Dollar hegemony in the world. But not to devalue would price US goods out of world markets, along with European goods. "Damned if you do, damned if you don't."


Dollar devaluation would force a Euro devaluation and all Hell would break lose, as all countries would belatedly realize the importance of having gold reserves, and one country after another would devalue their currencies against gold. Import tariffs and restrictions on imports would once again prevail. The dream of "Globalization based on the fiat dollar" would evaporate in the orgy of currency devaluations against gold.


The era of the Dollar as reserve currency of the world, would have ended.


When the dust shall have settled on this giant crisis, the powers of this world will have recognized, once again, that gold is money; what would remain would be the work of establishing the gold standard de jure, by international accords, in order to abolish tariffs and import restrictions and renew the free international flow of goods.


However, another horrible scenario is possible: the US, run by those who insist on maintaining the plan for world domination through endless war, may decide to go to war with China and with Russia, too, for good measure. Let us hope that reason prevails and that the Dollar loses its status as world reserve currency in a peaceful manner."


franzpick's picture

Here is one MacLeod piece with brief reference to China's need to revalue the yuan price of gold. This is what's happening, and it's an upcoming worldwide financial calamity


franzpick's picture

Thanks anonnn for the links to Price and MacLeod and the goldmoney research, which are the best analysis of what has happened, and what probably will happen, disastrous as it may be.

Yen Cross's picture

 These guys get all their 'due dilligence' info from Z/H. The clown is using sub-indexes to prove his point.

 He's pecking away at one of the Tech indexes, based on several Chinese macro indexes. These a-holes have played the IDIOT card with investors for at least five years.

 This asshole thinks " due diligence" is a city in the Caribbean.

 As an example> I'll bet the prick doesn't even know what the primary onshore and offshore Chinese markets are?

 I'll bet he doesn't know anything about F/X  pertaining to cny/cnh and short term bond spreads. [ arbitration]

 Especially in the Over Night<> REPO markets.

Bangin7GramRocks's picture

Yen, you are some smart mother fucker! You spit serious knowledge on the regular. I appreciate your real world input on ZH. I'm only good for dick and cunt jokes. But I guess we all have our thing...

Yen Cross's picture

 That's very kind coming from a room of geniuses.

RockySpears's picture

I fear the room is shrinking.

SheepDog-One's picture

I bet this guy didn't call any drop from the highs, but now he's predicting 'rise then fall then rise' no wait it's 'fall then rise then fall'....yea whatever.

FreedomGuy's picture

Call me skeptical, too. I want video of him calling those highs, etc. I have yet to see anyone who does not have an intro of how they called in right back in...

What he leaves out are reasons.

I am not a professional investor, but these pattern and chart investors have some bad assumptions and big holes in their theories. The main one is reproducability and the other are "events". Stuff happens and that can and should throw any patterns for a loop.

JamaicaJim's picture

The ONLY way this market is going up - and continuing this shit show..

Is the FED resuming openly digitizing the USD....

not like they are STILL DOING IT...they are...behind the backs of the stupid....the T-Bill two step of 2016

The mere fact that it costs upwards of $60,000 to buy 100 shares of Amazon - among other asinine price pegs of today's "market", is a sure sign that a long term top is in place, and unless the Fed thinks up money/debt, it will not continue "up"

...which makes the whole Fuckbama regime and their touting the rise in the rigged casino only believable to morons and takers...

This guy is some crystal ball toting market timer.....a dime a dozen

luna_man's picture



To think these "market's" are going anywhere but down, is being too hopeful.


The "market's" are tired and have been abused by CRIMINALS.


you are going to be in awe at the collapse

Yen Cross's picture

  Well, it's nice to know your rapist, before he or she violates you?