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Is JPMorgan Stock Finally Set to Break Out After Earnings?

The Street logo The Street 4/12/2019 Bret Kenwell
a sign on the side of a building: Is JPMorgan Stock Finally Set to Break Out After Earnings?© TheStreet Is JPMorgan Stock Finally Set to Break Out After Earnings?

Shares of JPMorgan are jumping on Friday, up 4.6% to $111.14 after beating on earnings and revenue expectations.

A positive reaction for PNC Financial is helping, as the duo gives the bank stocks a lift. While Wells Fargo beat on earnings and revenue expectations, shares are down about 3% in midday Friday trading.

Will this be enough to allow JPMorgan stock to really rally? Over the last year, the bank (and the sector in general) has had a series of fizzled out rallies despite the overall market doing relatively well. After JPMorgan's earnings of $2.65 a share came in 30 cents ahead of estimates, and revenue of $29.85 billion came in $1.8 billion ahead of expectations, one would think that if there's ever a time for a continued rally, it's now.

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a close up of a map: 18-month daily chart of JPMorgan stock.© Provided by TheStreet Inc 18-month daily chart of JPMorgan stock.

So far, JPMorgan stock has pressed higher on Friday, which is a big deal as many bank stocks tend to gap higher on earnings before giving up their gains throughout the session (see Wells Fargo).

Shares of JPMorgan, Goldman Sachs , Bank of America and others were breaking out in mid-March, but cratered off that breakout on worries over an inverting yield curve. Those worries were short lived and we got a rebound in these stocks as a result. For JPMorgan, it brought the stock back to recent range resistance near $106 just before earnings.

Now vaulting higher, JPMorgan stock opened near channel resistance (purple line) and quickly pushed higher into the $110 to $112 area. This has been a zone of resistance over the past year and it will be interesting to see whether JPM can now push through. If it can, the $115 to $116 area will be on deck.

If JPMorgan stock can't get through this zone, I would love to see the backside of prior uptrend resistance hold as support. Should it fail as support, it would be encouraging to see JPMorgan stock hold the $108 level. While a pullback-and-hold to the $106 area/200-day moving average makes JPMorgan stock technically OK, it would be very discouraging to give up all of its post-earnings gains.

The bottom line? Let's see how JPMorgan stock handles $111 to $112. The best setup from here would be a continuation up to $115 resistance and a pullback into this current area that acts as support.

This article was originally published by TheStreet.

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