The S&P 500 faces a possible decline of around 6 percent since the index ran into a major resistance level and failed to break it, Julius De Kempenaer, manager at Taler Trend Fund, told CNBC Monday.
"Because the rally has been so steep since September there's also a risk of a pretty serious correction and that happens if we say drop below levels of 1,190 – 1,180 (points)," De Kempenaer said.
"In that case, the room for decline is around 5 to 6 percent," he added.
The current uptrend in the S&P is still intact on the basis of a series of higher highs and higher lows, De Kempenaer said. But the index has failed to break through a major resistance level at around 1,220 – 1,230 points, which corresponds with the highs of last April, he said. The S&P closed at 1,199.21 on Friday.
De Kempenaer said he is still a "longer-term equity bull" and would buy into the market if the S&P did decline in the region of 6 percent from the 1,190 – 1,180 point level.
Within the S&P , utility stocks have outperformed and may be due for weakness, but consumer discretionary stocks could be due to improve, he said.