JPM Soars To $350 with Q4 Earning's Catalyst ?
Q4 2025 earnings season has just kickstarted this week.
Major US banks will be leading the way this week, reporting their earnings, following a year of robust performance in the financial sector.
Outlook for Big Bank Earnings
The probability of US big banks delivering "stellar" earnings remains high, although the drivers of profit are shifting.
Analysts expect a 10th consecutive quarter of S&P 500 earnings growth, with the financial sector as a primary engine.
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Investment Banking Rebound: A +65% YoY surge in M&A volume during Q4 2025 is expected to bolster fee income for firms like $Goldman Sachs(GS)$ and JP Morgan.
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Trading Performance: Increased market volatility in late 2025—marked by a sharp November dip and a record-breaking December are likely boosted equity and fixed-income trading revenues.
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Net Interest Income (NII) Pressures: With the Fed cutting rates thrice in late 2025 (interest now in the 3.50% - 3.75% range), banks are facing downward pressure on loan margins. However, lower deposit costs and robust loan demand are expected to offset some of these headwinds.
XLF ETF: 12-Month Performance
The $Financial Select Sector SPDR Fund(XLF)$ had an exceptional performance in the past 12 months, reflecting (a) resilience of US economy and (b) a resurgence in capital markets. (see below)
Performance:
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XLF has largely followed an upward trajectory, supported by strong bank balance sheets and a "soft landing" economic narrative.
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As of early January 2026, it is trading near multi-year highs.
Valuation:
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XLF currently sports a Price/Earnings (P/E) ratio of approximately 19.13, with an estimated 3 - 5 year EPS growth rate of +12.98%.
Sentiment:
Recent option data shows a high volume of contracts (over 181,000) with a put-call ratio of 1.38, suggesting that while the long-term trend is bullish, some investors are hedging for a potential short-term pullback following its massive December rally.
Q4 2025 Earnings Forecast
JPMorgan is scheduled to report on Tue, 13 Jan 2026.
As the industry bellwether, its results will set the tone for the entire sector.
Earnings Forecast.
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Earnings Per Share (EPS): expected at $4.87 to $5.01, marking a 3.3% to 4.2% YoY increase from last year.
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Total Revenue: forecasted to be between $45.65 to $46.2 billion, that’s a +6.8% to +7.0% YoY gain.
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Net Interest Income: expected to be approx. $25 billion , that is a solid return despite US central bank’ multiple interest cuts in H2 2025.
Key Focus Areas:
Trading Strength:
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Coming off a Q3 where equity trading rose 33%, analysts are looking for continued dominance in global markets.
Credit Quality: I
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Investors to monitor non-performing assets, that are estimated to rise slightly by +3.5% to $8.1 billion.
2026 Guidance:
JPM has a history of conservative NII guidance.
Any "rosy outlook" will depend on CEO, Jamie Dimon’s commentary regarding:
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2026 "normalization" phase of US interest rates.
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Sustainability of the investment banking fee recovery.
Technical Analysis & Price Movement
JPM's stock reached a record high of $335 in the week of 6 Jan 2026.
Technical indicators suggest a strong but potentially "extended" position. (see below)
Simple Moving Averages (SMA):
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JPM is trading well above its 50-day SMA ($314.59) and 200-day SMA ($287.88).
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This confirms a primary bullish trend.
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The 20-day SMA is acting as immediate support near the $323.61 level.
MACD:
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Currently reading at $0.30$, providing a "Buy" signal as it remains in positive territory, though the histogram is showing signs of narrowing, indicating slowing momentum.
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With the MACD line (+4.93) sitting above both zero line and its signal line (+4.71), the positive divergence (0.22) confirms strong, expanding bullish momentum.
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This setup indicates an immediate upward trajectory, with the stock poised to challenge its recent record highs.
RSI (14-Day):
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Coming in at 58.58, JPM has pulled back from "overbought" levels recently (above 70), giving the stock "room to run" before becoming technically overheated again.
Trading Volume:
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Volume has been steady but not explosive.
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A breakout above $335 on high volume, would confirm the next leg up toward $350.
Formation:
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There is evidence of a Cup and Handle formation on the medium-term chart.
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The "Cup" was formed between April 2025 lows and October 2025 highs.
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The "Handle" was the consolidation seen in early January 2026.
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A decisive close above $335 would complete the breakout from this bullish continuation pattern.
My viewpoints : (mine only)
Despite optimism surrounding JPM and a likelihood of a further rise after Q4 results are out, I am not considering adding JPM to my holdings yet.
This is because (a) it is beyond my budget and (b) I foresee a pull back in the horizon, with rising geopolitical tension in the US.
It is hoped that the bank might consider a forward stock split so that it becomes more accessible to investors.
Afterall, the last time JPM exercised a 3-for-2 forward split, was 25 years ago, on 12 Jun 2000. 25 years on, 2026 is the ‘perfect’ time for the bank to consider another, agree ?
Remember to check out my other posts. (See below). Help to Repost ok, Thanks.
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Do you think JPM’s Q4 2025 earnings will exceed Wall Street’s forecast ?
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Do you think US banking sector will soar to new highs in 2026, based off XLF performance ?
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