Illumina (ILMN): Bullish Structure Builds After Breakout

Long-Term Breakout Confirmation

Illumina, Inc. (ILMN) is a genomics company that makes DNA sequencing and array-based technologies used to analyze genetic material. Its stock confirmed a long-term bullish reversal signal that triggered last month on a breakout of an inverse head and shoulders pattern. The month ended above the $155.53 breakout signal thereby confirming the bullish signal on the longer timeframe monthly chart. During the advance the 200-week moving average was reclaimed, further showing strength and a clear shift from sellers being in control to buyers taking control.

 Early-Stage Trend Reversal Takes Shape

The inverse head and shoulders breakout along with the 200-week moving average reclaim, suggests that a long-term shift is in process and is still in its early stages. Following the breakout, a high of $177.22 was reached last week, resulting in a bearish weekly shooting star candlestick pattern forming. That weekly pattern triggered to the downside this week, leading to a test of support near previous resistance around the prior trend high of $155.53. That level was recognized as support on Tuesday, leading to an intraday advance, as the low of the day was $155.55. Since this long-term bullish reversal signal remains fresh, participation should start to broaden if follow-through buying develops.

 Support Levels in Focus After Pullback

Although support was seen near prior highs on Tuesday, a drop below the day’s low could see a decline to test support near the 200-week moving average around $140.70. That average was broken in April 2022, with ILMN trading below it until the recent upside breakout, making its’ reclaim a notable long-term technical milestone.

Upside Targets from Measured Move Structure

Upside target zones start with a measured move from the head and shoulders pattern. An initial target is identified near $242.36, which is where the breakout target matches the difference in price defined by the height of the pattern. That zone is validated by a prior resistance shelf from 2022 and the 38.2% Fibonacci retracement of the prior decline at $248.78. When calculating the measured move based on a percentage change, the target points to $351.49, which is validated by the 61.8% Fibonacci retracement at $360.04.

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