"I think it's a tradeable bounce right now because we did test the 200-day moving average," said Stovall. "When you think about it. Fundamentally things haven't really changed that much. With so many people still on the sidelines and worried, my feeling is that if everyone is expecting this type of correction, it will be shallower than most people were looking for."
If the bottom is in, the market could have a more rapid recovery than normal based on the swift decline.
"My feeling is to know whether this is the real bottom, we probably will have to go through a retest of the cash lows," he said.
Stovall said history shows that six months after a correction, the S&P has been up an average of 22 percent, and the bottom three sectors outperform, with a 24 percent average gain. In corrections since 1990, there was even bigger outperformance when looking at the 12 sub-industry sectors that performed the worst. They gained more than the S&P 500 63 percent of the time six months after a correction, with an average 55 percent gain.
During the recent sell-off among the sectors, energy was down 14 percent, health care 11.7 percent and materials 10.6 percent.
Of the sub-industry sectors, semiconductor equipment, down 18.8 percent, did the worst, followed by life and health insurance, off 15.9 percent. Health-care supplies and oil and gas exploration and production were both down 15 percent.
Air freight and logistics also did poorly, losing 13.9 percent.
The S&P had a nearly 12 percent intraday decline before Friday's bounce, and was off 10.2 percent on a closing basis as of Thursday.
If the market continues to correct, the S&P has averaged corrections of 14 percent that took 98 days to go from peak on average.
Stocks that would benefit from infrastructure spending were also battered more than the broader market. Construction materials names fell 13.6 percent and construction machinery and heavy trucks stocks were down 13.3 percent.
Stovall picked stocks for each industry subsector that CFRA analysts rate the highest. For example, he chose Caterpillar in construction materials; Lam Research in semiconductor equipment; Walgreens Boost Alliance in drug retail; MetLife for life and health insurers; United Parcel Service for air freight and logistics; and Exxon Mobil for integrated oil and gas. Exxon, for instance, was down 12.8 percent since the beginning of the month, and it was up about a half percent Monday.