Eli Lilly And Co (NYSE:LLY) has capitalized on last week's impressive first-quarter earnings report. The stock scored a post-earnings bull gap of 9.8%, bouncing off an area of former resistance at $850. Up 0.5% to trade at $994.21, the security is pacing for a fifth-straight win -- its longest such streak since November. The streak has LLY flashing a historically bullish signal on the charts.
Specifically, the shares have toppled their 80-day moving average. Per Schaeffer's Senior Quantitative Analyst Rocky White, this “crossover” event happened 13 other times over the last 10 years, after which LLY was higher one month later roughly 77% of the time, averaging an 6.8% gain. From its current perch, a move of this magnitude would put the shares just shy of $1,060 -- the site of its February highs -- and above its year-to-date breakeven level.
Options look attractively priced, too, per LLY's Schaeffer's Volatility Index (SVI) of 34% that sits higher than 23% of readings from the past year. In other words, near-term option traders are now pricing in low volatility expectations.
