With consumer staples companies starting to attract renewed interest, personal products producer Eli Lilly (LLY) recently returned to the Green Favored Zone in the SIA S&P 100 Index Report. LLY had been steadily drifting downward in the rankings since September but has turned decisively back upward over the last few weeks. Yesterday, LLY finished in 10th place, up 3 spots on the day and up 20 positions in the last month.
Eli Lilly (LLY) shares actually bottomed out back in the fall of 2019 and as a Consumer Staples defensive play, the 2020 market crash seems to have only been a speed bump for LLY in the context of its larger uptrend. For over two years, the shares have been in an uptrend, but since June, they have been in a normal consolidation phase, trading between $225 and $275. Last month, the shares successfully retested support above $225 and their longer-term uptrend support line. In the last two weeks, they have started to climb again, regaining $250 to signal the start of a new upswing.
Initial resistance appears at the channel top near $275 where a breakout would confirm that accumulation has resumed and signals that a new upleg has started. Should that occur, next potential resistance could appear near the $300 round number, or a measured $325. Initial support appears near $250, then the uptrend line near $230.
Since last summer, Eli Lilly (LLY) has been trending sideways, consolidating previous advances. Over this time, the shares have continued to establish higher lows, indicating that their underlying uptrend remains intact. Since the beginning of this year the shares have become more active, staging a triple top breakout which quickly faltered followed by a small Double Bottom breakdown which appears to be faltering as well with the shares turning upward.
A breakout over $280.00 to a new high would call off the double bottom and signal the start of a new advance. Should that occur, next potential resistance could appear near the $300.00 round number, followed by $303.10 and $315.30 based on horizontal and vertical counts. Initial support appears near $238.95 based on a 3-box reversal.
With its bullish SMAX score increasing to 7, LLY is exhibiting strength against the asset classes.
Disclaimer: SIACharts Inc. specifically represents that it does not give investment advice or advocate the purchase or sale of any security or investment whatsoever. This information has been prepared without regard to any particular investors investment objectives, financial situation, and needs. None of the information contained in this document constitutes an offer to sell or the solicitation of an offer to buy any security or other investment or an offer to provide investment services of any kind. As such, advisors and their clients should not act on any recommendation (express or implied) or information in this report without obtaining specific advice in relation to their accounts and should not rely on information herein as the primary basis for their investment decisions. Information contained herein is based on data obtained from recognized statistical services, issuer reports or communications, or other sources, believed to be reliable. SIACharts Inc. nor its third party content providers make any representations or warranties or take any responsibility as to the accuracy or completeness of any recommendation or information contained herein and shall not be liable for any errors, inaccuracies or delays in content, or for any actions taken in reliance thereon. Any statements nonfactual in nature constitute only current opinions, which are subject to change without notice.
Copyright © SIACharts