Inside Markets — Bullish Trend

The direction of travel is higher in a bull market, and the SPX keeps its bullish trend intact at levels above ~6250. In the near-term, we expect the index will likely struggle to break above ~6470 without increased expectations for a prolonged easing cycle. The next major catalyst to influence policy expectations will be the August Jobs Report on September 5. Expect summertime liquidity conditions to persist until the week of 9/8 when directional cures from the Jobs Report become amplified for 1-3 days only. The week of 9/8 is full of sell-side industry conferences (so is the following week) where management usually takes the opportunity to update year-ahead guidance. Sell-side analysts often use these conferences to downwardly revise overly optimistic estimates. These revisions (primary driver of stock prices) and slowing fund flows into a September fiscal year-end are the primary headwinds that give this season its bearish reputation. Switching back to a technical lens, a sustained close below 6147 would open the window for a potential correction in our view.