Fundamentals My trading algorithm doubled down on KB Home today due to a substantial increase in Wall Street consensus earnings forecasts. I estimate that forward P/E on the stock is about 5, and forward P/S is about 0.6. (But note that my forecasts are more optimistic than the Street consensus, which currently puts forward P/E at 6.7.) I estimate that KBH will...
Housing is being bought up by major investment firms in mass right now. Namely Blackrock (you know, the military contract giant, yea that one) If you are waiting for housing to drop like I am to move into your first home, I guess these major investment firms will have to go belly up first or sell (going belly up looks more likely, pigs get fat and hogs get slaughtered.)
So one of my daily rants got long enough to warrant a Medium post. Whether you agree with it or not, I think I do have a plan mapped out for myself, at least financially speaking. The tl;dr is that underlying trends don't really look good for the US real-estate market right now, despite record high gains in the last few years. Or maybe it's more accurate to say...
Trade for DRV: - Long DRV 10C Feb 22, 2022 for 0.5 debit. - Entered position based on Distribution cycle tending to affect the price in last 20% of the wave. Target downgap fills: GLHF - DPT
Idea for Housing/REITs (VNQ): - The Housing Market will crash. I am short REITs. - Lumber rose 400% in a year during a global crisis and then dropped 50% in a month... This is not a correction, but a bubble pop. - China reining in commodity prices. They announce that they will soon release state stockpiles of metals: www.bloomberg.com - State firms ordered to...
Here is trade set up on EURUSD based on current US numbers. With job numbers shrinking and an increase in wages and CPI the US dollar will likely continue to suffer. Furthermore, a stalled housing market and retail participation is concerning for the economy. I expect that these domestic changes will cause some more upside momentum for EURUSD. Add the seasonality...
Housing stocks like Home Depot pulled back hard in May as the real estate market slowed. However, the bears may be throwing in the towel. The main pattern of interest on this chart is support materializing around $310. This was near the low on May 19, the same session that HD bounced at its 50-day simple moving average (SMA). It’s also near a price gap on April...
{repost from my blog which includes screenshots and charts} Housing Market Intro and Summary The Spring selling season looked like it started strong for new home sales. The data for April reveal a story evolving differently. Absolute inventories rose for both existing and new homes and yet sales declined. Housing starts also suffered a setback. Median prices of...
Trade for XRE: - Speculative trade. - Long put 16 strike Dec 17 2021 for 0.30 debit. GLHF - DPT
UWMC weekly right now hitting the middle band around the $8.60 range When we advance passed that we should move to about the $10.20 range before more resistance is hit with the upper wicks on previous candles. After that it could go back to all time highs. Let’s see how this one plays out in the coming days and weeks.
Speculative Idea for MBB (Mortgage-Backed Securities ETF): - Why is there a speculative housing bubble in the middle of a crisis? - "A major catalyst of the general financial crisis of 2008 was the subprime mortgage crisis of 2007, when a rising wave of defaults on home mortgages sent the value of mortgage backed securities plunging." - "They're in trouble right...
Speculation for US Government Bonds: "If you want to learn how to trade, go down to the beach and watch the waves." - Ed Seykota After reading this, I went down to the river and watched the waves for a bit, and came up with this model. If you think of a river, the riverbanks are made of sand and pebbles... Each pebble and grain of sand are underlying...
Technical Tuesday: Technical reasons to be short Canadian REITs (XRE): Mid Term (Trend): - Median Line with 80% chance to return to median line, once re-enters channel (Andrews) - Rising Wedge Short Term (Trade): - Exhaustion Gap (x2) - Double Top - Dark Cloud Cover Speculated movement within John Hill-Gann. Elliot Wave Projection forecasted. GLHF - DPT
Credit to Lyn Alden on Twitter for the idea for this chart. As she quipped when she posted a similar chart, inflation is low... as long as you don't buy food, or a house, or commodities. CPI inflation has been unusually low for the last decade From 2010 to 2019, CPI (the Consumer Price Index, a popular measure of inflation) averaged 1.73%. That's a...
There is a macro narrative underway that is wildly bullish for Home Depot. The fuse being lit here under a MASSIVE bull run evident within the latest WSJ article. Get ready for a flood of improvements and investments in homes. Keep in mind how cash flush consumers are, and how pent up they have been in their homes. The WSJ certainly made the case when they...
Model Forecast for the Housing & Real Estate Market: Synopsis: Underlying Conditions: Federal Deficit: Debt needs to be paid. Household Debt Payments have bottomed. Household Debt Service Payments as a Percentage of Disposable Personal Income (TDSP): Business Inventories will fall: Housing Starts are falling, and can fall much lower before...
Homebuilders have struggled lately as interest rates rose, but the longer-term prospects remain favorable. Today’s chart considers the pullback in DR Horton, the biggest name in the space. DHI hit a new all-time high of $84.41 on February 11 and pulled back. It’s now bouncing, which may create opportunities for buyers. Notice the high basing pattern between...
I recommended West Fraser Timer (WFT on TSX) some time ago. In November the company announced it would buy another lumber company, Norbord. Nov 19, 2020 | Posted in Corporate News, News West Fraser to Acquire Norbord, Creating a Diversified Global Wood Products Leader – Complementary OSB business expands product and geographic diversity – Greater scale and...