As the S&P 500 approaches 6000, I believe there are several key factors at play. The recent strength in the tech sector, coupled with continued optimism around AI and economic resilience, has pushed the index higher. However, the upcoming US CPI release could either validate the rally or trigger a pullback if inflation remains stubbornly high.
My view:
If CPI comes in lower than expected, it could further fuel the rally and create room for new highs beyond 6000.
If CPI surprises to the upside, markets might reassess the potential for more Fed rate hikes, causing a short-term dip
Overall, while I see some near-term caution warranted, the underlying trend remains bullish. I think there is a good chance we could see new highs if economic data supports the soft-landing narrative. Lets see how the CPI release shapes the direction this week!
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