Following a robust recovery from the 850 level, Eli Lilly ($LLY) is currently coiling under the $1,000 psychological barrier. We are long from 987 and looking to pyramid at 1010 as the path of least resistance shifts upward.
The Setup
- Darvas Context: Eli Lilly is trading at the upper end of the 880 to 1000 box
- Livermore Logic: Jesse Livermore identified that major round numbers—such as 100 or 1,000—act as powerful gravitational anchors. When a stock clears these pivotal points, it frequently validates a new trend, offering a high-probability opportunity for entry.
- Market Profile: Currently, LLY is testing the upper extreme of the May 2026 Value Area. A sustained breach of the $1,000 handle would signal an 'Auction Expansion' as the market seeks higher value, shifting the frame from range-bound consolidation to aggressive price discovery.
Risk Parameters
- Entry Price: $987.00
- Stop Loss: $940 (Low end of the current balance area)
- Pyramid Trigger: $1,010 (opportunity to add more)
- Target: $1130.
- Max Risk: $47 per unit
- Potential Gain: $140 per unit