LLY dominated by bears dragging the market lower throughout the day
Eli Lilly and Company (LLY) Technical Analysis Report for Aug 05, 2020 | by Techniquant Editorial Team
LLY ended Wednesday at 154.34 losing $0.51 (-0.33%), underperforming the S&P 500 (0.64%). The bears were in full control today, moving the market lower throughout the whole session. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (LLY as at Aug 05, 2020):
Wednesday's trading range has been $4.19 (2.66%), that's slightly above the last trading month's daily average range of $3.72. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for LLY.
One bearish candlestick pattern matches today's price action, the Black Candle.
Prices are trading close to the key technical support level at 152.40 (S1). After having been unable to move lower than 153.09 in the previous session, the share found buyers again around the same price level today at 153.30. The last time this happened on July 29th, LLY actually lost -5.41% on the following trading day.
Although the stock is currently in a short-term downtrend, this might just be a correction, as both the medium and long-term trends are still bullish.
Among the three market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Decisive Down Move" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Eli Lilly. Out of 272 times, LLY closed higher 55.15% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after 10 trading days, showing a win rate of 62.50% with an average market move of 1.11%.