The Dimon Bottom Hype Is Over
CNBC has loved to refer the recent pullback in the SPX as the "Dimon Bottom" because CEO Jamie Dimon purchased roughly $26 million worth of JPM shares. However, it's not looking for those wanting to hold to believe in the recovery dream.
Whether investors want to believe it or not, the U.S. economic cycle is rolling over; and, considering the very high correlation to the SPX, J.P. Morgan shares will unlikely be saved.
Since 2014, I been warning of potential headwinds from energy exposure in U.S. banks. It may not cripple the sixth-largest bank in the world, but death by 1,000 cuts won't be any better for shareholders.
On Tuesday, JPM reported a 20 percent decline in trading revenues, as well as a $500 million increase in provisions (up 60 percent) due to their energy exposure. Fee revenues were down 25 percent.
Technically, the weekly chart is showing more downside is to come. Traders are watching a 20-weekly bearish convergence with the 50- and 72-weekly EMA. Price action is, also, currently below the 200-weekly EMA.
The inability to show support above this level and challenge $59.60 could poise further stress on shares.
Near-term, we'll see price action test the trend/price demand between $52.30-$53.50. A close below $52.30 would open up $48.3 and trend lower to $43.74.
If looking at Fib. retracements, a close underneath Aug 24, 2015 Black Monday low, 1.618 Fib. extension would stand at $37.54. This would be my target for Q2-17.
Please feel free to comment and share charts! And follow me @Lemieux_26
Check my posts out at:
bullion.directory/about-bullion-directory/christopher-lemieux/
investing.com/members/200193197
teachingcurrencytrading.com
oilpro.com/chrislemieux
Whether investors want to believe it or not, the U.S. economic cycle is rolling over; and, considering the very high correlation to the SPX, J.P. Morgan shares will unlikely be saved.
Since 2014, I been warning of potential headwinds from energy exposure in U.S. banks. It may not cripple the sixth-largest bank in the world, but death by 1,000 cuts won't be any better for shareholders.
On Tuesday, JPM reported a 20 percent decline in trading revenues, as well as a $500 million increase in provisions (up 60 percent) due to their energy exposure. Fee revenues were down 25 percent.
Technically, the weekly chart is showing more downside is to come. Traders are watching a 20-weekly bearish convergence with the 50- and 72-weekly EMA. Price action is, also, currently below the 200-weekly EMA.
The inability to show support above this level and challenge $59.60 could poise further stress on shares.
Near-term, we'll see price action test the trend/price demand between $52.30-$53.50. A close below $52.30 would open up $48.3 and trend lower to $43.74.
If looking at Fib. retracements, a close underneath Aug 24, 2015 Black Monday low, 1.618 Fib. extension would stand at $37.54. This would be my target for Q2-17.
Please feel free to comment and share charts! And follow me @Lemieux_26
Check my posts out at:
bullion.directory/about-bullion-directory/christopher-lemieux/
investing.com/members/200193197
teachingcurrencytrading.com
oilpro.com/chrislemieux
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.