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Eli Lilly and Co (LLY) - August 16, 2023

Drugmaker Eli Lilly (LLY) has had a nice run in the Favored zone of the SIA S&P 100 Index Report where it holds the #1 ranking now. LLY has the best 1 day, 1 week, and 1 month performance out of all the holdings in the Report after a strong Q2 Earnings Report. Eli Lilly moved into the Favored zone in early April of 2023 and rose to one of the top holdings in the report after just a month.

Eli Lilly's Q2 earnings showed big gains in revenue, thanks mainly to diabetes therapy Mounjaro. Lilly reported quarterly revenue of $8.3 million, up 28% year over year. Mounjaro's sales were $797.7 million, up 73% over the same period last year. The company reported net income of $1.76 billion, up 84.7% year over year, and earnings per share (EPS) of $1.95, compared to $1.05 in the same quarter a year ago. We saw LLY Gap Up on this news last week experiencing its biggest one-day jump in almost two decades. LLY is now trading in a new range that it has been on as it continues to surge to new 52-week highs.

Looking at the Point and Figure chart of Eli Lilly (LLY), it has moved to new highs in a Double Top chart pattern. LLY has had only one reversal on a 2% chart going back to March of this year. This will obviously change with normal price movement going forward, but highlights the incredible run the LLY has been on since March, most of that time in the Favored zone of the SIA S&P 100 Report.

Potential upside resistance can now be found around the $600 level based on prior moves. Initial support appears just below $500 based on a 3-box reversal. Further support can be found at $467 and $431 should it break down further to the August lows before the Q2 Earnings Report was released.

With a perfect SMAX score of 10, LLY is exhibiting near-term strength across the asset classes.

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