When Wall Street sneezes, the rest of the world catches a cold, so says the old axiom. We're now going to see what happens when Wall Street has the flu, says one market watcher.

Since the bottom fell out of U.S. equities on Monday, stocks here and across the globe have been in disarray. The Dow and ended the day on Thursday in a correction mode, while the Nasdaq closed just shy of it. Stocks of 88 percent of S&P 500 companies have fallen 10 percent or more from their 52-week highs because of the sell-off. Since hitting a record on Jan. 26, the index has lost $2 trillion in market value.

Outside of the U.S. as of Thursday, Japan's Nikkei was in a correction, Germany's DAX was on the cusp of one and the FTSE 100 had dropped 8 percent.

The fever has yet to break on Wall Street, says Craig Johnson, senior technical strategist at Piper Jaffray.

"These are the early days of the flu," Johnson told CNBC's "Trading Nation" on Thursday. "It has not yet run the course. More time is going to be required."

Johnson had predicted on a previous appearance that the S&P 500 would see a decline before continuing on its upward trend — a move he characterized as a "hop, drop and a pop." For now, the markets remain in the "drop" phase as the S&P 500 closed below 2,600 for the first time since Nov. 22.

The S&P 500 looked like it was heading for a slight rebound in Friday's premarket. On Thursday, it plummeted 3.75 percent in its worst session since the more than 4 percent drop on Monday.

Before then, the index had not seen a decline of that magnitude since August 2011. It dropped below its 50-day moving average of 2,724 at the beginning of the week and ended Thursday's session around 4.5 percent below that level.

The Dow also plunged Thursday, dropping 1,032 points in its second-worst one-day point decline in history, putting it on track for its worst week since October 2008 during the depths of the financial crisis. Its futures price pointed to a slight rise Friday morning.

Both indexes have erased 2018 gains even after clocking their best starts to a year in January in some time. It was the Dow's best January since 2013 and the S&P 500's best since 1997.

Gina Sanchez, CEO of Chantinco Global, remains bullish on equities and recommends that nervous investors focus on the source of the sell-off.

"What's driving this downturn in the stock market is actually emanating from the bond market," Sanchez told "Trading Nation" on Thursday.

Bond prices have plummeted and yields spiked on concerns an uptick in inflation forecasts might push the Federal Reserve to act faster in tightening monetary policy than Wall Street had expected. On top of that, budget dealings in the House and Senate this week have raised worries over the swelling U.S. deficit. Congress passed the spending deal early Friday, ending an hours-old government shutdown.

"Those are all bond problems and ultimately those problems are going to cause a sell-off in the bond market," said Sanchez. "That money will ultimately find its way back into the stock market."

The yield on the U.S. 10-year Treasury reached a four-year high of 2.885 percent earlier Thursday, while the 30-year bond yield climbed to a peak not seen since mid-March. The 10-year yield ended the day at 2.837 percent.