Don't Ignore This Chart!

Eli Lilly Breaks 18 Month Downtrend

 | 

Eli Lilly (LLY) printed an exhaustion gap in November on massive volume, marking a significant bottom and over recent trading days broke a downtrend line that spanned 18 months of action.  Based on this combination and improving momentum, it certainly appears that LLY has seen its worst and has begun to experience much better technical action.  Check out the exhaustion gap on the daily chart:

The short-term picture has certainly improved, but more importantly it appears as if the longer-term downtrend on the weekly chart has broken.  Take a look....

The only downside at this point is that LLY is overbought in the very near-term.  So we can expect a little profit taking.  Outside of that, however, LLY appears poised to sustain a run to the upside.

Happy trading!

Tom

 

Announcement from the Author

{{ announcement.content }}

Tom Bowley
About the author: co-founded Invested Central in 2004 and served as the site's Chief Market Strategist for more than 10 years. Invested Central provides stock market education and guidance for those interested in making their own financial decisions. During his tenure at Invested Central, Tom co-hosted Market Open LIVE, a national radio broadcast that covered many of the largest markets across the U.S. In addition, he has spoken at various conferences throughout the United States and Canada and has taught thousands of traders across the globe how to trade equities more wisely with an emphasis on managing risk and intermarket relationships. Learn More
Subscribe to Don't Ignore This Chart! to be notified whenever a new post is added to this blog!
comments powered by Disqus