4 Trade Ideas for JP Morgan: Bonus Idea
- Posted by Greg Harmon
- on October 21st, 2024
Here is your Bonus Idea with links to the full Top Ten:
JP Morgan, $JPM, comes into the week at an all-time at prior resistance. The Bollinger Bands® have opened to allow a move higher. It has a RSI deep in the bullish zone with the MACD positive and rising. There is no resistance above 225.50 but a Measured Move gives a target to 236. Support lower comes at 221.50 and 217. Short interest is low at 1%. The stock pays a dividend with an annual yield of 2.22% and has traded ex-dividend since October 4th.
The company is expected to report earnings next on January 15th. The November options chain has biggest open interest at the 185 put strike and at the 225 call strike. In the December chain open interest is largest at the 200 put then 190. On the call side it is biggest at the 230 and 240 strikes. Finally, in the January chain open interest builds from the 225 put strike to a high at the 180 strike. On the call side it is spread from 180 to 260, biggest at 240 then 230.
JP Morgan, Ticker: $JPM
Trade Idea 1: Buy the stock on a move over 225.50 with a stop at 217.
Trade Idea 2: Buy the stock on a move over 225.50 and add a November 225/215 Put Spread ($3.00) while selling the December 240 Call ($2.65).
Trade Idea 3: Buy the November/December 235 Call Calendar ($2.40) and sell the November 215 Put ($1.80).
Trade Idea 4: Buy the January 210/230/240 Call Spread Risk Reversal (free).
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After reviewing over 1,000 charts, I have found some good setups for the week. These were selected and should be viewed in the context of the broad Market Macro picture reviewed Friday which with the October Options Expiration in the books, saw equity markets showing some strength battling against a narrative of slower Fed cuts.
Elsewhere look for Gold to continue its uptrend while Crude Oil drops in consolidation. The US Dollar Index may reverse the short term uptrend while US Treasuries pullback in consolidation. The Shanghai Composite looks to drop back from its spike while Emerging Markets stall in their move higher.
The Volatility Index looks to remain low making the path easier for equity markets to the upside. Their charts look strong, especially on the longer timeframe. On the shorter timeframe the SPY is leading the way higher with the QQQ slowly battling back to its high and the IWM poking its head up perhaps to make another attempt at a run higher. Use this information as you prepare for the coming week and trad’em well.
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The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.
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Gregory W. Harmon CMT, CFA, has traded since 1986 and held senior positions including Head of Global Trading, Head of Product Development, Head of Strategy and Director of Equity. (More)