JP MORGAN CHASE & CO (JPM)

Technical analysis

Price	$ 123,92	52 Weeks range	$ 118,22 - $ 172,96
Beta	1,09	Volume/ average	14.8m/ 16m
Sector	Financial services	Dividend	3,15%

JPMorgan Chase & Co. is an American multinational investment bank and financial services holding company headquartered in New York City and incorporated in Delaware.

JPM from the highs of $ 173 in October 2021 has slowly started a long and considerable reversal that has led the stock to be now on an interesting price range between $ 120-130.00.

From this area we believe there might be a good chance for a turnaround and change of medium-long term trend.

Price

Analysing the price action, the stock is in a well-defined bearish channel: confirmed by the series of lower lows and highs since the end of 2021.

We believe on the current $ 120-127 range the price could consolidate and then, in our opinion, start a gradual reversal to the upside: this thesis is supported by previous move where the price of $ 120 has played the role of resistance since January 2018. in October 2019 and in December 2020 where then started the last bullish rally.

On the weekly chart, the relevance of this price range is even more visible and leads us to consider a bottoming phase followed by a trend reversal.

Indicators

The MACD and RSI indicators suggest an encouraging scenario for the medium to long term: both show higher lows from March 2022, against a decreasing price.

The strong downward extension of the stock is also confirmed on the weekly chart: MACD is at a level seen only in March 2020 and the RSI has reached oversold territory. In particular, the extension of the RSI is relevant given the fact that this event only happened in March 2020 and September 2011.

Moving averages

We believe that the strong watershed for short-medium-term fluctuations is in this case the 50MA (yellow line): in recent months the latter has played the role of "dynamic resistance", rejecting any possible extension to the upside. We can see better on the daily chart, that a break of it and consolidation of the price between $ 135-140 could be a further confirmation of the trend change.

On the weekly chart we highlight how the stock is now on the 200MA (blue line) which we believe might playing the long-term support role.

Conclusions

At current price, we believe that JPM's risk /reward is in favour of medium to long-term long positions.

The downward extension of the stock, together with the strong support area of $ 120, we believe are indicators of a possible trend change. At the same time, being in a bearish trend, we seek price confirmations first: specifically, we believe that a consolidation between $ 130-135 can offer an optimal entry range.

We consider the two targets at $ 150 and $ 170 as conservative and they will eventually be revised upwards during the year.

Entry range $ 130 - $ 140,00

Target 1 $ 150,00

Target 2 $ 170,00

Stop loss $ 110,00