It looks like it is time to clean the decks on this stock and test the longs with a good old fashioned sell off. This latest overall market strength didn't include the home builders and therefore is a crack in the bull market, or at least just a rotation out of the leaders as folks re-balance their portfolios at quarter end and lighten up on some of the big winners.
It's time to put these on your short-candidate list and short them.
The regression channel has been violated and retested and has fallen back out of it again. 41-42 is very heavy resistance so my stop would be just above that zone. A break UNDER $34 is a good target. $39.73 last.
Technical Tim 4:01PM EST Tuesday April 9, 2013
Comments
CoinedByCrypto
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Nice charting on both stocks gents!!
timwest
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I just re-read my comments that a "BREAK UNDER $34 is a good target." That happened the other day and today's lift may just be the sign that this trade is over. Closing out this idea.
QuantitativeExhaustion
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Nice job. I think you can get upper 20's next week
timwest
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This one is working nicely. It could bounce a bit after expiration (today's options expiration) but stay the course. Lower stop to entry.
QuantitativeExhaustion
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Looks like a Triple Top
timwest
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It's been forming a nice pattern - I keep an eye on HD to see when these stocks really break to the downside. This rally in home builders and home builder supply stocks is due for a test. I am dubious. The rally in home prices is more of a dead-cat bounce than a new bull market.
QuantitativeExhaustion
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I agree. Will look into Home Depot HD and Lowes L. Looks like Lennar has hit the base of the support of a Triple Top (if it is a TT).
timwest
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If you take a look at the price of Lumber futures (LBU2013), you will see the implosion that happened there already. I think that is a leading indicator.
QuantitativeExhaustion
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You ain't kidding. Also yields on 10 years rising as well. 1/3 of all homes purchased this year are investors not retail home buyers. This is the consequence of the giant government hand that invades our lives. Unaffordable homes for new home buyers and young couples that want to start a family. The fed is not the friend of average Dick and Jane on Main Street.