JPMorgan Charts: Reasons to Be Bullish

By L.A. Little of tatoday.com, author of Trade Like the Little Guy.

JPMorgan Chase (JPM Quote) is one of those perennial financial stars -- the monolithic bank that seems to be everywhere and nowhere at the same time.

It's everywhere in that it is involved in so many deals and in countless markets. The bank is nowhere in that it's just behind the scenes, seldom in the limelight like Goldman Sachs(GS Quote) or Citigroup(C Quote). JPMorgan remains just outside the glare of the spotlight, yet is always in line when it comes time to rake in the dough.

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Since last year's financial melt, the bank has expanded its operations further, has digested more competitors, and has been applauded for doing so. JPMorgan's share price has ascended as well, almost back to all-time highs. Goldman needs to take some lessons from it on public relations.

Of course, this column is about the charts and where the next trade lies. With JPMorgan, that trade is a starter buy in the $39 area and further purchases back in the $32.50 to $35 area. You have to purchase enough around $39 just in case the lower prices simply never materialize. Unless volume expands seriously, the lower price range would be a great place to stock up, and here's why.

On a long-term time frame, the stock exhibits distinct levels of support and resistance.

Looking at the monthly chart and gauging volume characteristics, it is hard to see JPMorgan trading and staying under $30 in the long term.