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Eli Lilly Is Trading Strong Ahead of Earnings on Wednesday

Jim Cramer said that Eli Lilly was the best of the pharmaceutical companies as he looked at the companies reporting earnings this week.
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Jim Cramer thought that Eli Lilly Inc. (LLY) was the best of the pharmaceutical companies as he looked at the companies reporting earnings this week at the top of his Mad Money program Friday. Let's look at the charts.

In this daily bar chart of LLY, below, we can see a strong uptrend the past twelve months. Why do I call it a strong trend? Easy - LLY pretty much ignored the weakness in the broad markets in the fourth quarter. Prices did decline in December from $120 down to $105 but prices did not break the September and October lows. Few stocks can say that today. Prices are above the rising 50-day moving average line and the bullish 200-day line. The Moving Average Convergence Divergence (MACD) oscillator is above the zero line and just signaled a fresh buy signal

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In this weekly bar chart of LLY, below, we can see a two-year consolidation pattern before LLY launched its uptrend. Prices are above the rising 40-week moving average line. The weekly OBV line show a rising pattern from late 2016. The weekly MACD oscillator is in a take profits sell mode but could soon turn back up to an outright buy.

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In this Point and Figure chart of LLY, below, we can see that the trade at $120.05 was an upside breakout. A $135.45 price target is being projected.

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Bottom line strategy: LLY has been rallying ahead its anticipated earnings release. I would look for LLY to continue its advance after earnings too. $135 is our next upside price target.

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