Bullish charts and fundamentals are lining up for JPMorgan Chase, says Frank Cappelleri
As a technician and CMT charter holder, I focus on price action first. But when the fundamentals reinforce the technicals, they always gets my attention. (After all, I also persevered through the CFA process many years ago.) JPM appears to have both working in its favor right now, something that became even clearer following yesterday’s strong earnings report. Let’s start with the daily chart: JPMhad a wild session Tuesday followingthe release of its latest quarterly numbers. The stock initially fell more than2%, then reversed sharply to rally nearly6% intraday, ultimately finishing with a2.5% gain. The result was anextremely large bullish engulfing candlestick, along with anew intraday highand all-time closing high. In fact, the candle engulfednearly three weeks of the prior price action.Coming immediately after earnings, that reversal carries added significance, as investors now have a much clearer view of the state of the company. While the daily chart does not yet show aclassical chart pattern, the technical backdrop is clearly bullish. With earnings now behind it,knowncompany-specific risk has diminished, allowing price action to take center stage. As thesecond-largest holding in XLF (slightly) behind Berkshire Hathaway ,JPMperformance will continue to have an important influence on the Financial sector. Even thoughJPMmade anew all-time highTuesday, it isnot extendedby its own historical standards. We can see that by viewing the stock within thisupward-sloping channelon theweekly log-scale chart. Since bottoming inOctober 2022,JPMorganhas remained in awell-defined uptrend, though certainly not in a straight line. The stock has experienced several sharp swings in both directions, with pullbacks consistently finding support near thelower boundary of the channelbefore resuming higher. Likewise, rallies have often paused after reaching or briefly exceeding theupper boundary. The stocknow sitsnear the middle of that channel, suggesting it isnot stretched. In fact, after spending much of the last few months in thelower halfof the range, there is room for the stock to work its way back toward theupper half, where it spent much of2025. The bottom line is straightforward:as long as JPMorgan remains within this channel, the long-term uptrend remains intact. Here’s themonthly log-scale chartgoing back to2013. As we know,JPMhas advanced at a remarkably consistent pace for more than a decade, meaning thatbuying virtually anywhereduring that period has been rewarded. What catches our attention are thebreakouts from multi-month and multi-year trading ranges. As is clear, those breakouts have repeatedly led tomonths — and in some cases years — of additional upside. With yesterday’s move tonew all-time highs,JPMmay be entering another one of those longer-term advancing phases. Altogether, we have a strong earnings report, a sizable positive reversal, new all-time highs, a stock trading near the middle of a well-defined upward sloping channel, and the potential breakout from a multi-year base. None of that guarantees future gains, of course, but the more technical factors that align — especially across multiple timeframes — the stronger the overall case becomes. —Frank Cappelleri Founder: https://cappthesis.com DISCLOSURES: None All opinions expressed by the CNBC Pro contributors are solely their opinions and do not reflect the opinions of CNBC, or its parent company or affiliates, and may have been previously disseminated by them on television, radio, internet or another medium. THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT ANY INDIVIDUAL’S UNIQUE PERSONAL CIRCUMSTANCES. THE ABOVE CONTENT MIGHT NOT BE SUITABLE FOR YOUR PARTICULAR CIRCUMSTANCES. BEFORE MAKING ANY FINANCIAL DECISIONS, YOU SHOULD STRONGLY CONSIDER SEEKING ADVICE FROM YOUR OWN FINANCIAL OR INVESTMENT ADVISOR. Click here for the full disclaimer.
