Last updated on April 12th, 2023 at 09:13 pm
In this post, we will be analyzing JPMorgan Chase (JPM) stock using a weekly chart and applying technical analysis to identify potential entry and exit points for traders and investors.
The first step in technical analysis is to identify the trend. Looking at the weekly chart of JPM, we can see that the stock the stock seems has been trading sideways for the last 1 month along the 50 weekly moving average. It is close to breaking out either downwards or upwards. If it breaks out of the 200 weekly moving average resistance, it will be the start of an upward trend.
Support and Resistance Levels
Next, we can identify the key support and resistance levels on the weekly chart. The support level is the price level where buying pressure is expected to emerge, while the resistance level is the price level where selling pressure is expected to emerge.
From the weekly chart, we can see that the stock price broke has been trading sideways between the 50 weekly moving average as support and 200 weekly moving average as resistance. As the price range is very narrow, there could be a potential rapid movement either upwards or downwards soon.
Technical Indicators
Technical indicators can also be used to identify potential entry and exit points. In this analysis, we will be using the moving average convergence divergence (MACD) indicator and the relative strength index (RSI) indicator and stochastics.
• MACD (Moving Average Convergence Divergence) is a good measure to identify the changes in trends and stock momentum. The MACD (violet) line is below the signal (orange) line indicating a bearish movement in stock price and these lines are currently along the mid-level of the chart.
• RSI (Relative Strength Index) is a good indicator to determine if a stock is overbought or oversold. Generally, when the RSI crosses above 30 from below, it may indicate a buy signal, and when the RSI crosses below 70 from above, it may indicate a sell signal. The RSI is currently bouncing around the 40 range for a few weeks indicating indecision.
• Stochastics is another technical indicator that can help investors determine if the stock is likely to continue in its current direction or if there may be a change in trend coming. When the black line crosses over the red line, it means a bullish sign and vice versa. Currently the black line has just crossed the red line, and it has happened from the lower band of stochastics chart. This could mean a potential upward trend on the stock soon.
At what price should I buy JPM stock?
Based on the analysis of the weekly chart of JPM stock, we can see that the stock is trading sideways currently and there is an indecision in the market. The technical indicators are also showing mixed indications on the future momentum of stock as seen from MACD and Stochastics. In conclusion, the stock price is probably going to experience a momentum either downwards or upwards.
For moderate to high-risk individuals betting on the long-term potential of
JPMorgan Chase company, the current price levels of $125 to $130 could be a solid entry point in case the stock breaks above the resistance at 200 weekly moving average. It would be also be a good idea to set a stop loss level of 5-10% (~$115) depending on the risk levels below the 50 weekly moving average support level at $125 to prevent huge losses in case the stock trades downwards.
For conservative investors, it would be ideal to wait for the stock price to close above the 200 weekly moving average at $129 for 2-3 days and then enter the market.
As with all investments, it is important to conduct your own research and analysis before making any trading decisions.
Read about potential entry point of competitors of JPM at: Bank of America, Goldman Sachs
