For the rally to last, the jump higher in stocks this week will need to be supported by cyclical stocks, JPMorgan told clients.
"The leadership shift away from dividend payers needs to stick for the S&P 500 breakout rally to have legs," read the technical note from the investment bank.
In the first half of the year, the hunt for yield led investors to overweight sectors like utilities and telecoms, known for their low-beta qualities and above-average dividend payments. That trend, however, reversed in the past few days, as market participants bought stocks that are more sensitive to the economic cycle.
"In our view, that new dynamic needs to develop into a lasting trend for the breakout rally to extend through the next layer of resistance at 2,169-2,183," technical analysts at JPMorgan wrote, an upward move of as much as 1.4 percent from Wednesday's close.