JPM Chart – Trading Channels & Moving Averages

I charted JP Morgan ($JPM) after the markets closed on Wednesday, 3/3/10, when it finished the day at $41.53.  JPM has spent the past six months in a trading channel heading lower, but is on the rise within a shorter channel right now.  I sold naked puts on it yesterday based on the expectation that it looks like it’s going to run up to the $44 range before coming back down.  It could keep climbing, but that’s my first target before I reconsider the position.

In addition to the trend lines, JPM is moving above its moving averages each week.  I think the 200 day moving average could act as a floor to the downside in the near term giving the potential for more gains a little more credibility.  The 50 day moving average has held support the past couple of days which adds to the bullish picture.  The bears might point to the 100 day moving average which is still a solid hurdle for JPM to deal with.  Within the next few days we’ll see if the short trading channel continues to work for JPM or if the 100 day moving average offers more resistance than the trend lines can handle.