Investors should be wary, Art Cashin told CNBC on Thursday.
The UBS director of floor operations at NYSE said on "Squawk on the Street" the markets could come under pressure as certain sentiment indicators reach extremes.
"The fear-and-greed indicator that's out is one of the highest levels it's been at in a while," he said. "The number of market letter writers who are bullish (are) close to 60 some odd percent, and we tend to get pullbacks after that."
Cashin also said investors need only look to history to uncover what the Federal Reserve's interest rate hike could mean for the markets.
"Recall that it was the emerging markets that dragged us down after last December's hike," he said. "That will be a danger."
For investors looking for a chance to get in, the market's rebound on Thursday is a highlight, Cashin said.
"I think it's good because this is the sign as we call them, buy the dippers," he said. "The people who said, 'My goodness, the rally started without me. I can't get in. I need a pullback.' And this was their first sign of a pullback."