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He called the collapse; here's what he's watching

Stocks were slammed in Monday's session, continuing a brutal three-day stretch that saw the Dow shed more than 1,400 points at breakneck speed. More than $680 billion in market cap evaporated from S&P 500 companies on Monday alone. But even with all three major U.S. averages now firmly in correction territory, one noted market analyst, who has been calling for a sharp selloff, says the bleeding could be far from over.

"World growth has slowed somewhat, quite significantly, and I think U.S. growth has slowed a lot," Raoul Pal of the Global Macro Investor and Real Vision TV told CNBC's "Fast Money" on Monday.

Pal, a former hedge-fund manager and Goldman Sachs alumnus, has been making bold market predictions for months, calling for a stronger dollar and weaker oil as far back as November 2014. Crude oil has dropped nearly 60 percent since that forecast, and the dollar has rallied more than 13 percent.

In July, Pal called China a "wildcard" and said the country could "create well more problems than people are imagining." China devalued its currency just a few weeks later, sparking panic across global markets.

Now, Pal says it could just be a matter of time before the U.S. enters a full-blown recession.

"What we'd need to see, to see this accelerate further to the downside, would be evidence of an actual recession," he said Monday.

Pal said he was watching key indicators including the ISM Manufacturing Index for signs of a slowdown. "If the ISM, for example, crosses 50 to the downside, we usually get a high probability of a 20 percent or so correction. So, I think we need a bit more evidence for the time being, but I do think it's coming."

One central tenet of Pal's recession call rests on the strength of the U.S. dollar. To that end, he reiterated his forecast for future dollar strength, despite a 4 percent pullback in the Dollar Index over the past month. "The dollar bull market is intact against almost every currency" except for those that make up the Dollar Index, he said.

In addition to playing into his global slowdown fears, Pal said the carnage of the past week will also likely influence the Fed's decision whether or not to raise rates in September.

"I think it's extremely difficult for them to raise rates," he said. "Inflation is imploding, I think we're seeing negative inflation again pretty soon, into deflation, I think employment is not as good as people expected...so I think it's very difficult for them to justify raising rates here."