7/31/2017 – A $121 Price Target for JP Morgan (JPM)
JP Morgan (JPM) is a leading bank in the financial sector. Its share price is approaching Benjamin status (the $100 price level).
The last full-length article I wrote analyzing the company was "Long-Term Trend Review for BAC, C & JPM". I made the following comments while summarizing that article:
So do the charts of BAC, C & JPM have anything in common? They are all in uptrends with support areas below where additional purchases can be made to add shares to your portfolio.
All of the charts also provide for approximate 10% - 20% upside moves before their charts need to be re-analyzed.
Based on JPM's share price at the time, that 20% potential upside move correlates with the price targets I calculated in my previous full-length article for JPM, which I wrote back in January 2017.
The January 2017 article was titled "1/29/2017 – JP Morgan Chase (JPM)". In the article I calculated an upside price target range of $110 - $115 for JPM's share price. I also made the following comment:
Any scale-in purchase below $85 and closer to the $80 area is a great opportunity to jump in on the uptrend.
It's time to check in on the progress of JPM's share price towards my price targets. And while I am at it, let's see how some of my comments fared as well. Off to the charts!
JP Morgan (JPM)
This first chart for JP Morgan (JPM) is a 10 year weekly candlestick chart. I used weekly candlesticks instead of monthly candlesticks over the 10 years. A little more detail is sometimes helpful when placing Fibonacci Extension Tools on a chart.
I want to look long-term and evaluate JPM's progress towards the $110 - $115 price target I calculated back in January 2017. Sometimes price targets can be tweaked after a little more price activity happens.
In my January 2017 update, I also mentioned that 1 more pullback was probable before JPM's next leg up took place. Let's see how I fared.
10 Year Weekly
I placed 4 different Fibonacci Extension Tools on the chart - a black, green, blue and purple tool. The purple tool is a medium-term tool while the rest provide for long-term price objectives. Focus on the confluence of lines from the green and purple Fibonacci Extension Tools when you look at the chart.
The first confluence area I want to discuss is the intersection of the green 100% Target Line and the purple 261.8% Target Line. That intersection was right around the $93.50 price area. JPM's share price saw resistance at this confluence area but has not broken though.
Now that JPM's share price broke above that resistance area, it appears to be headed to the next higher confluence area. The next higher confluence area for the green and purple Target Lines is in the $115 - $121 price range. I identified that range with the gray shaded box. I see that price target range as the highest probability of JPM's minimum upside price. Look for a possible trade opportunity around the $102 price level though.
One of the main reasons I feel confident with JPM's share price reaching the $121 price level? That price level represents the Golden Ratio for the green Fibonacci Extension Tool. I always look for the Golden Ratio trade.
Calculate Expected Return & Estimated Time Frame
One way to calculate an estimated time frame is with the Fibonacci Extension Tool. Since I think the $121 is the most probable price target, I will make some calculations based on the green Fibonacci Extension Tool.
With a $121.68 estimated price target, JPM's share price has potential for an approximate 33% gain based on the current share price of $91.28. But how long is it going to take to earn that 33%? Let's estimate the time frame. Start by…...
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I review methods to calculate an estimated time as to when JPM's share price will reach my $121 price objective. I also discuss possible trade set-ups from a Moving Average perspective. And last, bullish price objectives from Point & Figure charts are discussed.
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