Back in July, Enzio von Pfeil, chief executive officer of EconomicClock.com, predicted a stock market crash in October. On Wednesday, von Pfeil reiterated his forecast, saying: "It doesn't have to be a calamitous crash. But I do think we're heading towards something. One sees that the market's become a lot more 'toppy'. It's stopped going up and up and up."
- Click Here to Watch July 15 Video for von Pfeil's Forecast
"One sees far too many players in the market that perhaps shouldn't even be there," he added.
One reason for a big selloff is likely to be strong downward earnings revisions occurring in the near future, von Pfeil said.
"There's going to be quite a bit of strong downward earnings revisions going forward, especially the outlook for 2010. And that's simply because the economic clock, of which we tell the economic time, suggests that the excess supply of goods (rising unemployment) is here to stay and you can't keep on making profits if unemployment keeps rising," he told CNBC.
This Earnings Season Won't Be as Dazzling
The worst of the earnings results will come out of labor-intensive and consumer-led industries, according to von Pfeil.
"The key earnings surprises will be in those industries which cannot keep on cutting workers," he said. "In other words, the basic materials and the very labor-intensive industries, like the car industry that very much have already gone through their cost-cutting exercises."
The U.S. will have the worst earnings results, closely followed by Europe as problems in the housing sector and consumer sector remain. But von Pfeil warned that Asia will also be affected by the earnings news from the West.