JPMorgan Chase & Co. (JPM), the largest of the four "too big to fail" money center banks, reports quarterly earnings before the opening bell on Friday. Analysts expect JPMorgan to report earnings per share (EPS) of $1.71. This means that the bank's string of eight consecutive quarters beating EPS estimates is on the line this week. Analysts have cited the benefits to the bank from higher interest rates, but investors should be concerned about trading profits and sluggish loan growth.

The stock closed Wednesday at $110.25, up 3.1% year to date and in bull market territory at 35% above its 52-week low of $81.64 set on May 31, 2017. The stock set its all-time intraday high of $110.70 on Jan. 10, 2018.

According to FDIC data, JPMorgan ended the third quarter of 2017 with $2.29 trillion of assets on its balance sheet, which equates to 13.3% of the entire banking system. This represents a year-over-year gain of 4.1%, so this "too big to fail" bank keeps getting bigger. It seems to me that a positive earnings report might be priced into JPMorgan's bull market gains. (See also: JPMorgan Chase & Co.: The Big Bank.)

The daily chart for JPMorgan

Daily technical chart showing the performance of JPMorgan Chase & Co. (JPM) stockCourtesy of MetaStock Xenith

JPMorgan has been above a "golden cross" since June 6, 2016, when the stock closed at $65.28. A "golden cross" occurs when the 50-day simple moving average rises above the 200-day simple moving average and indicates that higher prices lie ahead. The 50-day simple moving average was last tested on Nov. 15, when this average was $96.62. The horizontal lines show that the stock is above its quarterly, semiannual and annual value levels of $103.50, $98.79 and $93.20, respectively.

The weekly chart for JPMorgan

Weekly technical chart showing the performance of JPMorgan Chase & Co. (JPM) stockCourtesy of MetaStock Xenith

The weekly chart for JPMorgan is positive but overbought, with the stock above its five-week modified moving average of $105.69. The stock is well above its 200-week simple moving average at $71.00, which is also the "reversion to the mean," last tested during the week of Feb. 12, 2016, when the average was $54.44. The 12 x 3 x 3 weekly slow stochastic reading is projected to rise to 88.32 this week, up from 86.86 on Jan. 5, moving further above the overbought threshold of 80.00.

Given these charts and analysis, my strategy is to buy JPMorgan shares on weakness to my quarterly value level of $103.50 and to reduce holdings on strength to my weekly risky level of $112.35. (For more, see: Why Big Bank Stocks Can Rise 20%: Barclays.)

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