Several factors suggest the stock market is running out of steam, Jurrien Timmer of Fidelity Investments said Tuesday.
"Technically, I think this rally is ending," he said. "There's a number of reasons for it."
On CNBC's "Fast Money," Timmer alluded to the Elliott wave principle in analyzing investor sentiment.
"We have a five-wave structure up off the November lows. We have divergences against this fifth wave. We have momentum sell signals," he said. "We have fairly one-sided sentiment on the bullish side.
"And if you look at the market since the beginning of the year, one by one, various key bellwethers have been rolling over, sort of like riders being dropped out of a peloton if you're a cyclist — copper, the Shanghai Composite, Eurozone banks and, just last week, small caps."
Timmer, who is Fidelity's global macro director and co-manager of Fidelity Global Strategies Fund, added,
"Long-term it still looks fairly constructive for risk assets."
Timmer said that he was looking at 1,539 as a key level of support for the S&P 500.
"If we break that, then I think for a lot of chartists that'll be confirmation that things are rolling over here," he added.
On the upside, "1,590 is a level where wave five would be equal to wave one, which is a typical Elliot Wave thing," Timmer said.
"If we go above, say, 1,600 and we just keep sort of going against these overbought signals, then the notion that maybe the secular tide is turning, I think, holds some real water," he said. "And I'm very open-minded to that idea."
Timmer said that he wanted to see better leadership from related asset groups following a 13-year-old secular bull market.
"It's possible that this is all a stealth correction, and that things like Eurozone banks and copper all of a sudden start to pick up," he said.
But that was the less likely scenario in Timmer's view.
"At this point, I think, the weight of the evidence tells me to be tactically at least defensive here," he said.
Trader disclosure: On April 9, 2013, the following stocks and commodities mentioned or intended to be mentioned on CNBC's "Fast Money" were owned by the "Fast Money" traders: Jon Najarian is long PWE; Jon Najarian is long NUAN; Jon Najarian is long TJX; Jon Najarian is long OC; Jon Najarian is long JPM CALLS; Jon Najarian is short GLD; Jon Najarian is short SLV; Jon Najarian is short VXX; Steve Weiss is long QCOM; Steve Weiss is short JCP; Pete Najarian is long AAPL; Pete Najarian is long BAC CALLS; Pete Najarian is long JPM CALLS; Pete Najarian is long BBRY; Pete Najarian is long AMZN CALLS; Mike Murphy is long AAPL; Mike Murphy is long BAC; Mike Murphy is long F;
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