Here’s your trade on Eli Lilly ($LLY) – December 1, 2023
This is Dan Fitzpatrick with FITZ IN FIVE. I want to look at Eli Lilly ( NYSE: LLY ) today.
I don’t think there is anything to do on this stock, don’t get all lathered up, I don’t think there is anything to do on this stock right now, except watch it. The reason I’m saying that is because the stock has been in an uptrend. Just look at the 50-day moving average, and the 200-day as well, it’s working really, really nicely.
But you see the 50 start to flatten out a little bit, while the 200-day moving average is just moving higher. These are starting to converge, which is actually a good thing if the uptrend is to be perpetuated. With that said, what I am waiting for here, this is just really simple, what I am waiting for here is a move back above, we’ll say, 600.00.
If this stock can get above 600.00, and close above 600.00, this is a stock you absolutely, definitely want to put on your buy list. Because for one thing, if you are buying it right around here, let’s say it closes above today’s intraday high, we’ll call it 602.00, if it closes above 602.00, if you just put it down below the 50-day moving average, and you don’t want to own the stock if it falls back down that low, your risk is less than 4 percent.
That is a pretty good risk/reward, and it is a good way to start a position. That is just something that you want to keep in mind. Generally speaking, the market is really, really running. You’ve got the percentage of stocks above their 40-day moving average, up at 72 percent. You’ve got the percentage of stocks above their 200-day up above 50 percent. These are all really bullish numbers.
You’ve got the QQQs ( NASDAQ: QQQ ) hanging in there after a big run in November. So there are a lot of good things happening in the market. Semiconductors ( NASDAQ: SMH ) are hanging in there. Retail ( NYSEARCA: XRT ) is starting to come up, and I’ve got to see retail if I am going to be a believer in a rally.
And then, I want to see the banks ( INDEXDJX: DJUSBK ) also going higher. How about the construction index ( INDEXDJX: DJUSHB )? A new high here. So when you really look at this, you have to be very, very constructive on the market. And to be saying, “Oh, but the market’s due for a correction.” It is; it is due for a correction. And we were due for a recession in 2023, and here we are.
So things are behaving a little nonsensically. And that doesn’t mean that you just throw caution to the wind and say, “Hey man, buy them and ride them, and we are all going to be rich by Thursday.” Maybe that’s the case but it isn’t going to be next Thursday. You want to be using some prudence in what you are doing. But you definitely want to be adding risk on. You want to be buying equities, you just want to be buying them right.
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