The stock market could surge another 12% through the end of the year as more than $100 billion pours into equity funds, JPMorgan says

According to a Thursday note from JP Morgan, the current rally in the stock market can continue through the end of the year.

The S&P 500 year-end price target of 4,800 is 12% upside potential from current levels, according to the bank.

The 10th percentile is where equity positioning among systematic and discretionary funds has fallen.

For the next 2 to 3 months, these strategies can provide steady inflow of billions of dollars into the equity market. Trend following strategies that were mostly short equity are covering shorts.

Buying stock helps increase demand and ultimately sends stock prices higher. The S&P 500 is on the verge of flashing positive technical signals that will lead to more buying from systematic funds.

If the S&P 500 is able to recover above its 200 day moving average, then upwards of $100 billion in fund flows could pour into the stock market.

He doesn't recommend investors chase mega-cap tech stocks or "recession proof" stocks that are trading near all-time highs.

The S&P 600 is a small-cap index that is trading at recession-level multiples, as well as the energy sector, which still offers an attractive valuation.

He believes that the 2020s will look nothing like the 2010s and that many of the investment trends will be turned upside down.