“The market in February became extremely oversold, and from this extremely oversold position, we can have a relatively strong rally,” Faber said on CNBC’s “Squawk Box.”

Faber, who runs the Gloom, Doom & Boom newsletter with the purpose of “rescuing investors from their errors of optimism,” also said the rally is part of the economic cycle, and will eventually crest into a recession in the long term.

Meaning the short-term market rally that he refers to would be a correction of oversold markets, the Swiss investor continued.

But Faber said he has a few reasons for believing in a near-term rally: Several momentum stocks have lost 25 to 30% from highs in 2015 during the early weeks of 2016, and oil, which has risen in the past few days to about $35 a barrel, could “easily” rebound 10% to 20%.

That could drive up the S&P 500 Index up to 2,050. The S&P 500 closed at 1,986 Wednesday, down 3% year-to-date. The index has rallied over the last two days, rising 2% since Tuesday’s open.

“But I don’t necessarily see new highs,” Faber said. He expects a decline after the potential rally, because “the global economy is slowing down very considerably.”

Despite the U.S.’s relatively stable job growth and consumer spending numbers, Faber says he believes the nation is unlikely to continue its growth trajectory because it is so interconnected with the rest of the world.