"Using actual inflation numbers in the economy — as it was calculated 30 years ago before they had all these gimmicks to so-called adjust inflation — then we are right now in a very important contraction already in the economy," Dohmen said.

He explained that one identifier of a bear market is the 200-day moving average on a major index. "Now we have all the major indices below the 200-day" moving average," he said.

Dohmen went on to say investors need to look at the charts of important indices many people don't look at, giving as an example the Dow Jones Transportation Index. "This is very important because transportation is necessary to move goods," he said.