Don't Ignore This Chart!

JP Morgan Leads Financials with Breakout and New High


Banking stocks are leading the market on Wednesday and JP Morgan is leading the sector as one of the first of the big banks to hit a new high. I featured the Regional Bank SPDR (KRE) and the Bank SPDR (KBE) in ChartWatchers this weekend and JPM has the same chart pattern working. After a Brexit-induced swoon in June, the stock recovered sharply and broke above its May high with a gap-surge in early August. The stock corrected most of September with a falling flag and broke flag resistance with a surge above 67 today. 

Note that I am drawing internal trend lines to mark the flag. An internal trend line cuts through a spike high or an intraday low. Trend lines are not "hard" resistance levels anyway and I used them mostly to define patterns. The falling flag is a bullish continuation pattern and the breakout signals a continuation of the July-August advance. It is positive to see the finance sector leading the market because it is the third biggest sector in the S&P 500 (13.2%). In addition to the flag breakout, MACD turned up and moved above its signal line. 

Thanks for tuning in and have a great day!
--Arthur Hill CMT

Plan your Trade and Trade your Plan

Arthur Hill
About the author: , CMT, is the Chief Technical Strategist at Focusing predominantly on US equities and ETFs, his systematic approach of identifying trend, finding signals within the trend, and setting key price levels has made him an esteemed market technician. Arthur has written articles for numerous financial publications including Barrons and Stocks & Commodities Magazine. In addition to his Chartered Market Technician (CMT) designation, he holds an MBA from the Cass Business School at City University in London. Learn More
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