LLY Options Signal Bullish Bias: Target $1120 Calls as Short-Term Catalysts Emerge

• Eli Lilly’s price cuts in China/Canada spark near-term skepticism but mask long-term GLP-1 growth
• Options data shows heavy call open interest at $1120 (1336 contracts) and $1080 (908), with puts clustered near $1010 (773)
• RSI at 78.6 suggests overbought conditions, but 30D support at $1074.18 holds firm

Here’s the deal: LLY’s options market is whispering bullishness, even as the stock dips 0.35% today. The key takeaway? Traders are betting on a rebound above $1080, with the $1120 strike acting as a psychological magnet. Let’s break it down.

Bullish Sentiment in the Striking Zones

LLY’s options chain is a goldmine of insight. For Friday’s expiration, the top call strike at $1120 has 1336 open interest—nearly double the next closest at $1080. That’s not just noise; it’s a crowd of traders expecting a pop. Meanwhile, puts are piling up at $1010 (773 OI) and $1040 (766), suggesting a floor near $1040 if the stock stumbles. The put/call ratio for open interest is 0.96, meaning calls edge out puts slightly. But here’s the catch: the bearish engulfing candle on the daily chart warns of a short-term pullback. Don’t ignore that red flag.

News vs. Options: A Tug-of-War

Eli Lilly’s price cuts in China and Canada have rattled investors, but the bigger story is its oral GLP-1 drug, orforglipron, which just showed weight-maintenance efficacy. Analysts are raising price targets to $1200, and institutional buyers like Norges Bank are piling in. The options market isn’t buying the near-term pain—it’s betting on the long game. Think of it like a boxer: the punches (price cuts) hurt now, but the title fight (GLP-1 dominance) is still winnable.

Actionable Trades for Today

For options: Go LLY20260102C1120 (Friday’s $1120 call) if you’re bullish. The high open interest means liquidity, and a close above $1120 would ignite momentum. Alternatively, LLY20260109C1080 (next Friday’s $1080 call) offers a safer play if the stock consolidates. For stock: Buy near the 30D support at $1074.18 with a stop below $1052.08. Target $1080 first, then $1100. If the MACD crosses above the signal line (currently -1.09), it’s a green light.

Volatility on the Horizon

The Bollinger Bands show LLY is trading near the middle band, which means it’s neither overextended up nor down. But with RSI at 78.6, a pullback is likely. The real action starts in 2026: orforglipron’s launch and manufacturing expansions could push the stock past $1150. For now, treat the $1074–$1076 resistance cluster as a speed bump, not a wall. This isn’t a sprint—it’s a marathon. Stay patient, and let the fundamentals do the heavy lifting.