Chart Advisor: JPM Climbing into Favor

By Paul Kornfeld, CFA

1/ JPMorgan Chase & Co. Returns to the Favored Zone

2/ Candlestick JPM Chart Highlights Continuing Accumulation

3/ Point and Figure JPM Chart Shows Big Technical Test Approaching

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1/ JPMorgan Chase & Co. Returns to the Favored Zone

At SIACharts, we compare head-to-head battles of thousands of stocks, commodities, mutual funds, and exchange traded funds daily and rank them by who is winning the most in their respective universes. The top 25% are considered to be in the Green Favored Zone, 26-50% make up the Yellow Neutral Zone, and the bottom half of each investment report is considered the Red Unfavored Zone.

US financials have been struggling within their respective reports for most of this year, generally since regional banks ran into trouble back in March. As treasury yields fell over the last month, interest rate sensitive groups like Financials, Utilities, and Real Estate have been on the rebound.

Yesterday, JPMorgan Chase & Co. (JPM) became the first US big cap bank to return to the Green Favored Zone of the SIA S&P 100 Index Report in some time climbing 2 spots to 25th place. JPM had been out of the Green Zone since August. JPM shares have gained nearly 10.5% in the last month.

2/ Candlestick JPM Chart Highlights Continuing Accumulation

Over the last year, a new uptrend has emerged in JPMorgan Chase (JPM) shares. Starting near $100.00 just over a year ago, the shares have steadily advanced with higher lows forming a new uptrend, while previous resistance points and downtrend lines have been steadily taken out.

Of interest, the $140.00 level has reversed between support and resistance several times over the last three years. An attempt to drive the shares back under it was rejected back in October, and since then the shares have been steadily climbing, and are now in their sixth consecutive week of gains. Last week, the shares broke out over their summer high near $145.00, signaling the start of a new up-leg.

Initial upside resistance looms between the $150.00 round number and the fall 2021 peak near $152.50. On a breakout, measured moves suggest the next potential resistance zone may emerge in the $175.00 to $180.00 area. Initial support may emerge near the $150.00 round number, then closer to $140.00 or the 50-day moving average just above it.

3/ Point and Figure JPM Chart Shows Big Technical Test Approaching

Since bottoming out just over a year ago, JPMorgan Chase & Co. (JPM) shares have bounced back in three phases, an initial rally up to March 2023, a spring/summer rally, and the most recent advance which started a few weeks ago. In between these rallies, there have been corrections which bottomed out at higher lows, a sign of an emerging upward trend.

The most recent pullback did generate a high pole warning, but not a full pattern breakdown. The current move has cleared $155.00 carrying the shares to their highest levels since early 2022 and completing a bullish Double Top breakout.

The shares are approaching potential resistance at their November 2021 peak near $163.95. A close above that level at new highs would confirm continued accumulation with next potential resistance on trend near $195.95 where vertical and horizontal counts converge. Initial support appears near $145.60 based on a common 3-box reversal.

With a perfect SMAX score (which is a near-term 1-to-90-day indicator comparing against different equal-weight asset classes) of 10 out of 10, JPM is exhibiting short-strength across all asset classes.

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Originally posted 5th December 2023