4 Trade Ideas for Eli Lilly: Bonus Idea

• Posted by Greg Harmon
• on May 28th, 2024

Here is your Bonus Idea with links to the full Top Ten:

Eli Lilly, $LLY, comes into the week after breaking a long consolidation channel. Last week it broke above 800 and held ending the nearly 4 month consolidation. The Bollinger Bands® have shifted higher with the RSI rising in the bullish zone and the MACD positive and climbing. There is no resistance above 820. Support comes lower at 800 and 784 then 765 and 750 before 733 and 724. Short interest is low under 1%. The stock pays a dividend with an annual yield of 0.64% and has traded ex-dividend since May 15th.

The company is expected to report earnings next on August 8th. The June options chain shows biggest open interest at the 750 put strike and the 850 then 900 call strikes. In the July chain open interest builds from 830 to 700 on the put side and is spread from 750 to 900, biggest at 860, on the call side. Finally, the August chain shows a large slug of open interest at the 700 put strike and the 820 call.

Eli Lilly, Ticker: $LLY

Trade Idea 1: Buy the stock on a move over 820 with a stop at 790.

Trade Idea 2: Buy the stock on a move over 820 and add a June 800/780 Put Spread ($9.65) while selling the July 880 Call ($9.25).

Trade Idea 3: Buy the June/August 850 Call Calendar ($23.85) and sell the July 750 Puts ($8.10).

Trade Idea 4: Buy the August 760/820/880 Call Spread Risk Reversal ($2.00).

Premium Content

The Best

The Rest Premium                                                                                 

Free Content

The Rest

Start of Summer Annual Sale! Hi all the Start of Summer Annual Sale is on at Dragonfly Capital. Get an annual subscription for 38.2% off or pay quarterly for 15% off. Both auto-renew at that discounted rate until you decide to leave.

After reviewing over 1,000 charts, I have found some good setups for the week. These were selected and should be viewed in the context of the broad Market Macro picture reviewed Friday which with the unofficial start of summer Monday and just 4 trading days left in May, saw equity markets were mixed with tech strong, large caps flat and small caps lower.

Elsewhere look for Gold to continue to consolidate in the uptrend while Crude Oil resumes a short term downtrend. The US Dollar Index may resume the short term move lower while US Treasuries remain in a downtrend. The Shanghai Composite looks to pause in the short term move higher while Emerging Markets may be confirming a failed break out higher.

The Volatility Index looks to remain very low and stable making the path easier for equity markets to the upside. The charts of the SPY and QQQ look strong, especially on the longer timeframe. On the shorter timeframe the QQQ is also strong with the SPY in consolidation. The IWM continues to be the outlier, consolidating at a higher range. Use this information as you prepare for the coming week and trad’em well.

If you like what you see above sign up for deeper analysis and trading strategy by using the Get Premium button above. As always you can see details of individual charts and more on my StockTwits page.

The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

blog comments powered by Disqus