Cramer: Market sell-off could reverse if this week's Trump-Xi trade meeting is positive

Key Points
  • The stock market sell-off could "reverse" if talks between President Trump and Chinese President Xi Jinping go well, CNBC's Jim Cramer says.
  • Trump and Xi are to meet Friday at the G-20 summit in Argentina.
Trump's tariff comments are not good for business, says Jim Cramer

The stock market's recent meltdown could "reverse" if this week's meeting between President Donald Trump and Chinese President Xi Jinping goes well, CNBC's Jim Cramer said Tuesday.

If Trump were to say he had a really good talk and he wants to put January's planned tariff increase to 25 percent on hold, "then I come in on Monday morning with a change in posture," Cramer said on "Squawk Box."

"But I don't know if we're going to get that," the "Mad Money" host said.

Stocks opened lower Tuesday after Trump told The Wall Street Journal it's "highly unlikely" that he would delay the tariffs hike on $200 billion of Chinese goods from 10 percent to 25 percent.

The president's comments, published late Monday, came just days before his meeting with Xi in Buenos Aires at the G-20 summit being held on Friday and Saturday.

Wall Street had rallied Monday, lifting the out of correction territory. The Nasdaq remained in correction territory as of Monday's close.

Before the open on Monday, Cramer argued the market was displaying "classic bear market behavior" by shooting up on nothing except being oversold. He later said that U.S. stocks are in a "bear market" not a correction.

Cramer said he was not using the traditional definitions of a bear market and a correction to make his case. "Who cares about the S&P? It's individual stocks that are down 40 or 50 percent."

A bear market is generally defined as an S&P 500 decline of 20 percent or more from recent highs. The threshold for a correction is measured as a drop of 10 percent or more from recent highs. The index, as of Monday's rally, was only about 9 percent away from its all-time intraday record in late September.

Cramer has said repeatedly in recent weeks that only the Federal Reserve changing course on hiking interest rates or Trump ending his tariffs would halt the market plunge.