USO - Smartest Banker In The World Sends A Message To Investors – Are You Listening? | Benzinga
To gain an edge, this is what you need to know today.
Important Message
Please click here for an enlarged chart of JPMorgan Chase & Co (NYSE: JPM).
Note the following:
- This article is about the big picture, not an individual stock. The chart of JPM stock is being used to illustrate the point.
- JPMorgan is the largest bank in the world by market capitalization. JPMorgan CEO Jamie Dimon is the smartest banker in the world.
- The chart shows that JPM stock has been running up.
- RSI on the chart shows that JPM stock had become very overbought. As we have been sharing with you, when a stock is very overbought, it is vulnerable to the downside on the slightest news.
- Yesterday was JPMorgan’s investor day. The momo crowd was aggressively buying the stock based on momentum ahead of the event on hope strategy.
- Even though the momo crowd controls the stock market these days, there are plenty of prudent investors. Collectively, smart money has many, many times more money than the momo crowd.
- In response to a question, Dimon said that JPMorgan would not buy back stock at the current level. In plain English, this means that Dimon considers the run up in JPM stock overdone. Smart money sold the stock to the momo crowd, taking advantage of the strength generated by momo crowd buying. However, momo crowd buying was not able to overcome smart money selling.
- If you read correctly, recently Warren Buffett said the same thing about Berkshire Hathaway Inc Class B (NYSE: BRK-B) stock. Buffett is also not aggressively buying back his stock at these levels.
- The chart shows a reversal and a big drop in JPM stock.
- Smart money was paying attention to Dimon’s answer, and they sold the stock.
- Knowledge is power. The more you learn, the better you will do in the stock market. Here are the learning moments:
- When smart money is selling a stock like JPM, they are not selling all of the position. They are only trimming their position.
- The momo crowd’s behavior is all in or all out. In contrast, smart money holds good positions for a very long time, and they simply trade around the core position. This is exactly what The Arora Report helps you do.
- Valuations matter. Valuations are considered in the quantitative screen of The ...