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Otradehouse
Jun 10, 2021 5:43 AM

JPM hot run slowing down? 

JP Morgan Chase & Co.NYSE

Description

Since fall of 2020 financials sector has been one of the leading drivers behind SPY run. JPM one of top stocks in finance sector has been on a tear as well.

In Nov price finally broke multi year long resistance around $117. Typically violated resistance levels are retested and act as a support. Worth noting 200 weekly MA is getting close to that level.

Will price retrace to test $117 anytime soon? Short answers: it’s definitely possible.

Detailed answer: current trend is showing signs of slowdown and a bit of weakness:
- Week of March 15 price tested another multi year resistance line on high volume, created a doji and closed lower than opened (can be seen on candlestick chart)
- since week of Mar 15 volume has seen significant decline
- PPO has been trending lower, and created negative divergence with price action.

All this eludes to some sort of a pullback. It would have to be almost (30%) decline from current highs to reach $117. It makes sense for this to happen in the foreseeable future, considering other option being price climbing higher and then eventually taking even larger dive down to reach $117. I am watching PPO in case it reverts back to the uptrend, along with higher volumes to signal higher prices.
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