JPMorgan Stock Rises After Trump Tweets at Dimon

JPM will offer a 60,000-point reward to certain customers

Sep 13, 2018 at 10:09 AM
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JPMorgan Chase & Co. (NYSE:JPM) said it is offering a 60,000-point bonus to credit card customers who open a new Sapphire account that could be worth up to $900 if used for travel. However, the offer appears to be an appeal to wealthier millennials -- who make up more than half of Sapphire account holders -- considering it will be awarded to those who maintain a minimum of $75,000 in investments or deposits over a three-month period.

Also on Wall Street's radar today is a tit for tat between JPMorgan CEO Jamie Dimon and U.S. President Donald Trump. After Dimon yesterday said he could "beat Trump," because he's "smarter than he is" -- comments he later retracted -- Trump tweeted today that Dimon is "a poor public speaker & nervous mess."

Amid these headlines, JPM stock is popping, with the shares last seen up 0.9% at $114.05. Looking closer at the charts, the security has been churning atop support at $113 -- a 61.8% Fibonacci retracement of its late-February to early July decline, and currently home to its 50-day moving average -- since a July 23 bull gap. Year-to-date, the equity is holding on to a 6% gain.

Options traders, meanwhile, have been growing increasingly skeptical of the Dow stock. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the equity's 10-day put/call volume ratio of 0.62 ranks in the 74th annual percentile, meaning puts have been bought to open relative to calls at a quicker-than-usual clip.

Considering JPMorgan stock is trading not far from its Feb. 27 record high of $119.33, some of this activity could be the result of shareholders initiating an options hedge. Whatever the reason, it's an attractive time to buy premium on JPM, considering its Schaeffer's Volatility Index (SVI) of 17% ranks in the 12th annual percentile. This means that short-term options are pricing in lower-than-usual volatility expectations.


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