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Biggest Risk in JPMorgan Is to the Upside: Pro Trader

Thursday, 12 Jul 2012 | 1:23 PM ET

On Friday, you can be sure the Street will be talking about Jamie Dimon.

Before the bell, JPMorgan will release its first earnings reports since the bank revealed its multi-billion dollar trading blunder in the spring.

And it’s likely the Street will be saying one of two things: A) that CEO Dimon is a rock star or B) that Dimon deserved his walk of shame before Congress.

It's a big report. Fast Money Trader Joe Terranova, chief market strategist for Virtus, thinks results will set the tone for the rest of the sector and perhaps the market too. Considering it could go either way, how should you position?

Trader Mike Murphy, founder and managing partner at Rosecliff Capital, is bullish. “I think the risk is to the upside. If the loss is under $5 billion and we get some clarity on the stock repurchase program I think shares can shoot up to $40.”

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Pete Najarian, co-founder OptionMonster.com, is somewhat in the middle. “I like the stock going into the report because I think all the negative is priced in. Right now the stock is holding around $34. I’d buy more on a dip and take profits on a pop.”

Trader Brian Kelly, founder of Shelter Harbor Capital, is largely bearish. “I’d take profits on any pop. Aside from the London Whale scandal, there’s also the LIBOR probe and quite frankly the environment for capital markets isn’t very friendly.”

Posted by CNBC's Lee Brodie

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Trader disclosure: On July 12, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Mike Murphy is long SBUX; Mike Murphy is long FB; Mike Murphy is long NAV CALLS; Mike Murphy is long CMI; Mike Murphy is long CHK; Mike Murphy is long CSX; Mike Murphy is long FDX; Brian Kelly is long TLY; Brian Kelly is long SPY PUTS; Guy Adami is long C; Guy Adami is long GS; Guy Adami is long INTC; Guy Adami is long NUE; Guy Adami is long AGU; Guy Adami is long BTU; Guy Adami is long MSFT; Guy’s Wife works at Merck; Pete Najarian is long AAPL; Pete Najarian is long C; Pete Najarian is long JPM CALLS; Pete Najarian is long INTC; Pete Najarian is long SBUX; Pete Najarian is long FB; Pete Najarian is long MRK; Pete Najarian is long NSC

For Boris Schlossberg
Nothing to disclose

For Eric Jackson
Eric Jacson is long YHOO

For Rick Snyder
Nothing to disclose

For Marci Ryvicker
Wells Fargo Securities, LLC maintains a market in the common stock of DIS
Wells Fargo Securities, LLC maintains a market in the common stock of CMST
Wells Fargo Securities, LLC maintains a market in the common stock of TWC


CNBC.com with wires.

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