'Stay away' from the Chinese stock market: Trader

Trading Nation: Bull & bear on Chinese stocks

China's stock market is red-hot.

After dropping 6.5 percent last Thursday, the has bounced back to a fresh multiyear high. But as the index is already up more than 50 percent year to date, one market participant has a simple message for investors: stay away.

"I think this market is so overheated," David Seaburg, Cowen and Co.'s head of sales trading, said Monday on CNBC's "Power Lunch." "It is totally stimulus driven right now and I wouldn't touch it with your money."

Read MoreShanghai stocks climb 1.7% amid regional slump

According to Seaburg, the recent rally in the market has been propelled by "euphoria" and there appears to be no fundamental backdrop to the surge. "You even have the government coming in and talking about the fact that we're in bubble territory," added Seaburg.

"I question, 'Can you even short this market?' And it's very difficult to answer given the fact that you never know which direction China is going to move in," he said. The index is up more than 140 percent in the past year. "Stay away from this market."

But not everyone is as wary as Seaburg, with technical analyst Todd Gordon noting that when you compare the current chart to that of 2007, the "volatility range," or the average high to low, is actually significantly lower than it's been in the past. This, he said, makes him "cautiously bullish and cautiously optimistic."

Gordon recommended looking to the ASHR, the ETF which tracks the Shanghai. "We're still in a well-defined uptrend channel," he said. "Anything above $46 is a buy and we'll look for continued range expansion."

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