Analyst Maintains Prediction of Monster Market Sell-Off This Week

Nomura analyst Masanari Takada is sticking with his prediction that a monster sell-off on Wall Street could arrive this week, CNBC is reporting.

Earlier this month, Takada predicted a "Lehman-like" plunge. CNBC noted the Dow dropped more than 33% in 2008 when Lehman Brothers went bust.

He said the market performance over the last two weeks showed an "uncanny resemblance" to 2008, according to CNBC.

"The U.S. stock market especially is facing its greatest test of the year thus far," Takada said in a note to clients on Monday.

Low sentiment is poised to prompt "panic-selling by fundamentals-oriented investors and systematic selling by trend-following technical investors along the way," he said.

His view is based on macro and quantitative data, which revealed sentiment is approaching its lowest level of the current cycle.

CNBC pointed out that this week is the last week before Labor Day and volumes are usually low at the end of August.

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