The firm cited the depth and length of the current downturn among Chinese equities as reasons why the declines may be close to an end. The recent declines have lasted about 40 weeks, retracing about half of the previous rally, Elliot Wave International said.
The Shanghai Composite is down 19% this year, including a loss of almost 10% in May. Beijing's efforts to cool economic growth and property speculation have hampered Chinese stocks.
China's benchmark stock exchange entered a so-called bear market this month after declining more than 20 percent from the November peak, and is the only index in Asia among the 10 worst performers worldwide, according to data compiled by Bloomberg.
Elliot Wave International also noted the Shenzhen Stock Exchange may be nearing the end of its sell-off. That exchange tracks small- and mid-cap stocks.