JPM update

jpm may 20 2013

We did not expect this stock to trade above $45 or so because, among other things, there appeared to be a very distinct B-wave triangle (not shown). The stock failed to drop and consequently a different scenario is playing itself out. In fact there are two such scenarios. The most bullish one would have the ups and downs over the past 13 years form a single triangle wave 4 which calls for a top potentially as high as $70. The problem with this scenario is that it will probable take too long. The other scenario, which is much more in line with the market overall, also sports a triangle but a much smaller one that is a wave B within a much larger degree wave B (in blue). If C equals A in this configuration the stock would peak at just over $60, which, coincidentally would equate to the levels reached in 2000 and would form a “double top”. The entire structure from 2000 onwards would then become wave 4. Time wise this process could be complete in a matter of months, perhaps even weeks if the present central banks orgy continues to propel the market into the next bubble. There was, of course, a time that JP Morgan was itself viewed as the central bank, which may explain why it has benefitted proportionately so much more than the few other too-big-to-bail/fail financial institutions in the US. The thrust, or wave c of B requires another 4-5 as far as we can tell. To play it safe we would, if we owned the stock, start selling at around $55 or at the very least put in a close stop-loss order. Ultimately the target would be around $20 if this is indeed going to be a wave 4.