JPMorgan at a Crossroads Bullish Surge or Bearish Retreat ? Hello, fellow traders!
Today, I’m diving into a detailed technical analysis of JPMorgan Chase & Co. (JPM) on the 2-hour chart, as shown in the screenshot. My goal is to break down the key elements of this chart in a professional yet accessible way, so whether you’re a seasoned trader or just starting out, you can follow along and understand the potential opportunities and risks in this setup. Let’s get started!
Price Action Overview
At the time of this analysis, JPM is trading at 243.62, down -1.64 (-0.67%) on the 2-hour timeframe. The chart spans from late March to early May, giving us a good look at the recent price behavior. The price has been in a strong uptrend, as evidenced by the higher highs and higher lows, but we’re now seeing signs of a potential pullback or consolidation.
The chart shows a breakout above a key resistance zone around the 234.50 level (highlighted in red on the Volume Profile), followed by a retest of this level as support. This is a classic bullish pattern: a breakout, a retest, and then a continuation higher. However, the recent price action suggests some hesitation, with a small bearish candle forming at the current price of 243.62. Let’s dig deeper into the tools and indicators to understand what’s happening.
Volume Profile Analysis
The Volume Profile on the right side of the chart is a powerful tool for identifying key price levels where significant trading activity has occurred. Here’s what it’s telling us:
Value Area High (VAH): 266.25
Point of Control (POC): 243.01
Value Area Low (VAL): 236.57
Profile Low: 224.25
The Point of Control (POC) at 243.01 is the price level with the highest traded volume in this range, acting as a magnet for price. Since the current price (243.62) is just above the POC, this level is likely providing some support. However, the fact that we’re so close to the POC suggests that the market is at a decision point—either we’ll see a bounce from this high-volume node, or a break below could lead to a deeper pullback toward the Value Area Low (VAL) at 236.57.
The Total Volume in VP Range is 62.798M shares, with an Average Volume per Bar of 174.44K. This indicates decent liquidity, but the Volume MA (21) at 165.709K is slightly below the average, suggesting that the recent price action hasn’t been accompanied by a significant spike in volume. This could mean that the current move lacks strong conviction, and we might see a consolidation phase before the next big move.
Trendlines and Key Levels
I’ve drawn two trendlines on the chart to highlight the structure of the price action:
Ascending Triangle Pattern: The chart shows an ascending triangle formation, with a flat resistance line around the 234.50 level (which was later broken) and an upward-sloping support trendline connecting the higher lows. Ascending triangles are typically bullish patterns, and the breakout above 234.50 confirmed this bias. After the breakout, the price retested the 234.50 level as support and continued higher, reaching a high of around 248.02.
Current Support Trendline: The upward-sloping trendline (drawn in white) is still intact, with the most recent low around 241.50 finding support on this line. This trendline is critical—if the price breaks below it, we could see a deeper correction toward the VAL at 236.57 or even the 234.50 support zone.
Key Price Levels to Watch
Based on the Volume Profile and price action, here are the key levels I’m watching:
Immediate Support: 243.01 (POC) and 241.50 (recent low on the trendline). A break below 241.50 could signal a short-term bearish move.
Next Support: 236.57 (VAL) and 234.50 (previous resistance turned support).
Resistance: 248.02 (recent high). A break above this level could target the Value Area High at 266.25, though that’s a longer-term target.
Deeper Support: If the price breaks below 234.50, the next significant level is 224.25 (Profile Low), which would indicate a major trend reversal.
Market Context and Timeframe
The chart covers 360 bars of data, starting from late March. This gives us a good sample size to analyze the trend. The 2-hour timeframe is ideal for swing traders or those looking to capture moves over a few days to a week. The broader trend remains bullish, but the recent price action suggests we might be entering a consolidation or pullback phase before the next leg higher.
Trading Strategy and Scenarios
Based on this analysis, here are the potential scenarios and how I’d approach trading JPM:
Bullish Scenario: If the price holds above the POC at 243.01 and the trendline support at 241.50, I’d look for a bounce toward the recent high of 248.02. A break above 248.02 could signal a continuation toward 266.25 (VAH). Entry could be on a strong bullish candle closing above 243.62, with a stop-loss below 241.50 to manage risk.
Bearish Scenario: If the price breaks below 241.50 and the POC at 243.01, I’d expect a pullback toward the VAL at 236.57 or the 234.50 support zone. A short position could be considered on a confirmed break below 241.50, with a stop-loss above 243.62 and a target at 236.57.
Consolidation Scenario: Given the lack of strong volume and the proximity to the POC, we might see the price consolidate between 241.50 and 248.02 for a while. In this case, I’d wait for a breakout or breakdown with strong volume to confirm the next move.
Risk Management
As always, risk management is key. The 2-hour timeframe can be volatile, so I recommend using a risk-reward ratio of at least 1:2. For example, if you’re going long at 243.62 with a stop-loss at 241.50 (a risk of 2.12 points), your target should be at least 248.02 (a reward of 4.40 points), giving you a 1:2 risk-reward ratio. Adjust your position size to risk no more than 1-2% of your account on this trade.
Final Thoughts
JPMorgan Chase & Co. (JPM) is showing a strong bullish trend on the 2-hour chart, with a confirmed breakout above the 234.50 resistance and a retest of this level as support. However, the recent price action near the POC at 243.01 and the lack of strong volume suggest that we might see a pullback or consolidation before the next move higher. The key levels to watch are 241.50 (trendline support), 243.01 (POC), and 248.02 (recent high).
For now, I’m leaning slightly bullish as long as the price holds above 241.50, but I’ll be ready to adjust my bias if we see a break below this level. Stay disciplined, manage your risk, and let the market show its hand before taking a position.
What are your thoughts on this setup? Let me know in the comments below, and happy trading!
This analysis is for educational purposes only and not financial advice. Always do your own research before making any trading decisions.
