Technical analyst who called the stock rally sees only a brief pause

Slowing short-term momentum and oversold conditions could set the stage for a small pullback in the stock market, according to BTIG's Katie Stockton.

But she does not expect the pause to last long, before the resumption of the second-longest bull run ever, which turned 8 years told Thursday.

On March 9, 2009, the S&P 500 hit a closing low of 676.53.

Last July, Stockton predicted the S&P would reach the 2,400 level, which the index achieved on an intraday basis on March 1.

The technical analyst said on "Squawk Box" on Thursday the market could retract slightly to reset for another run higher.

"I do think in the near term, several weeks or so, we'll see a deeper pullback, looking for maybe 2,280, something like that" on the S&P 500, Stockton said.

An S&P target of 2,280 would represent a 3.5 percent decline from where the index closed on Wednesday, at 2,364.

"Right now, we have positive long-term momentum behind the S&P 500, positive intermediate-term momentum, even, but negative short-term momentum," Stockton said. "And as long as that's the case, we view it as a short-term counter-trend move."

"I think the right assumption to make is that the uptrend is going to remain in force, as they often do," she continued. "This is obviously a bull market, so we want to be respectful of that and really give the market the benefit of the doubt until it tells us otherwise."

In that case, the dip will serve as more of a refresher for overly bullish sentiment measures rather than a formal correction, making it a relatively safe trade, Stockton contended.

"We have indicators that tend to be these market-internal measures — breadth, leadership, sentiment and volume — that tend to reach these oversold extremes at tradeable lows," Stockton said. "So whether it's 2,280 [or] 2,270, it's less important to me, but rather to see these oversold conditions registered, which we saw at all the three major lows last year."

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