JP Morgan Chase is the American leader in derivatives products. The latest months represented a difficult period for this institution, face to the heavy turnover decrease recorded since 2008. But the situation even deteriorates after the announcement of the heavy losses recorded on trades on derivatives.

The “London whale” seems to be responsible of the large positions taken on credit default swaps, a secured product based on sovereign debts. The positions taked on more than $100 billion would be probably sold in a short term perspective with losses exceeded $1.8 billion. The plans created to maintain the profit margin won’t be sufficient to contain the hemorrhage and JP Morgan lost investors confidence.

After the annual top reached on March at USD 46.3, the stock is declining and although the downward trend decelerated close to USD 40.65 support, the bad fundamental news may cause a new bearish momentum on the way to the USD 38 area. Investors will observed the trend during the next few sessions and the crossing support will marked a selling signal.

Investors will focus on the USD 34 area as soon as support will be broken. A stop loss will be engaged at USD 42 to avoid disappointment.