After three rough weeks on Wall Street, the stock market could lose another 10 percent from current levels before rocketing higher--at least if technicals are any indicator, a stock market observer told CNBC on Monday.
Last week, the index fell to "some pretty critical levels," including the 200-day moving average and reactionary low of 1,904, Jeffrey Saut, managing director at Raymond James, said on "Squawk Box." But the index was "very oversold on a short term basis." he added.
related investing news
"It's a logical place to try and rally here. I think it's a bull trap," Saut said. "I think we get a rally attempt here, but I think eventually stocks go lower, but it should be viewed within the context of a secular bull market that has eight to 10 years left in it."
Saut, who began his career on a New York trading desk in 1971, pointed to other tailwinds for the market. Lower gas prices, for example, will likely boost holiday shopping sales, he said.
"The forces forward are too powerful: the energy independence, the manufacturing revival, oodles of creativity in this country and a bunch of capital on the sidelines," he said. "I think we're in a secular bull market that has years left to run."
To Jeremy Siegel, a professor of finance at the University of Pennsylvania's Wharton School, lower energy prices will boost consumer spending and help push stocks higher. In fact, Siegel reiterated his call that the Dow Jones industrial average could finish the year at 18,000. Don't hold your breath waiting for that 10 percent correction, though, Siegel said.
"The market will trick the majority of the people most of the time. So those people that are waiting for that 10 percent correction, which we haven't had in two, three years, I think are going to be disappointed," Siegel said on "Squawk Box." "If we do get it, I think it's a great long-term entry position. I think a year or two from now you're going to be happy you own stocks."
Tobias Levkovich, chief U.S. market strategist for Citigroup, shared Saut's bullish view. It seems "there are animal spirits kind of rebuilding in the corporate sector," Levkovich said on "Squawk Box."
From improved hiring intentions to accelerating capital spending and the slew of recent mergers and acquisitions, CEOs appear to be getting more confident about the economy, he said.
Levkovich said he doesn't care whether stocks dip 10 percent or not—he'll continue to buy regardless.