After appearing somewhat elusive, Wall Street may finally be on the "launch pad" to a Santa Claus rally, closely followed trader Art Cashin told CNBC on Thursday.
U.S. stocks managed to close higher Wednesday after the major averages fell in four of the previous five sessions. Equities opened higher Thursday, but the Dow Jones industrial average was the only major U.S. stock index on pace for slight weekly gains.
"We're on the launch pad," said Cashin, UBS' director of floor operations at the New York Stock Exchange. "It'll be today, tomorrow and the first two trading days of next year."
"We've got some room," Cashin added in an interview on "Squawk on the Street." "The fact that we had a little bit of a rally [Wednesday] brought us back closer."
Earlier this week, Cashin predicted that the new GOP tax law would "distort" the Santa Claus rally, which normally occurs the last week of December through the first two trading days of January.
Cashin said Thursday that Wall Street needs to get higher than last Thursday's close to kick off the rally. "If they can hold these gains, we'll be right there," he said. "Not much of a rally, but at least a little bit of one."
He said the stock market's record run this year was "rather anomalous."
"Usually, you think you get there, you're going to get a short squeeze, you're going to get a real rush in," Cashin said. "We'll take it. Record closes are record closes."
Cashin added that he'd like to see more trading volume Thursday but acknowledged that many Americans are on vacation.