There could be a nice trading opportunity in Goldman following JP Morgan's bang-up results

A Goldman Sachs sign is seen on at the company's post on the floor of the New York Stock Exchange.
Brendan McDermid | Reuters

J.P. Morgan just kicked off earnings season with a smash, paving the way for Goldman Sachs to be the next big bank to crush Wall Street's forecasts, according to Wells Fargo.

Wells Fargo raised its price target for Goldman to $300 from $280 and hiked its fourth quarter earnings estimates, ahead of Goldman's earnings report on Wednesday.

"Based on better than expected trading results at JPM and a more bullish view on global trade and trading, we are increasing our estimates and price target for Goldman Sachs," said Wells Fargo senior banking analyst Mike Mayo in a note to clients on Tuesday.

Shares of J.P. Morgan jumped 1.2% on Tuesday after reporting profit and revenue that crushed analysts' expectations on a strong rebound in trading revenue at the end of last year.

The bright spot was that J.P. Morgan's investment bank earned a record amount of trading revenue: $2.61 billion in fixed income and $1.37 billion in equities. These results were well above's last year's trading revenues in the fourth quarter. Mayo said a turnaround in the trading business for banks will benefit Goldman as well, and should be reflected in its earnings.

Citigroup also beat analyst expectations for its earnings on Tuesday, driven by strong fixed-income trading revenues along with growing sales from the bank's consumer business. The results sent the stock up 2% on Tuesday.