(This is an excerpt from an article I originally published on Seeking Alpha on February 17, 2015. Click here to read the entire piece.)
The National Association of Home Builders/Wells Fargo Housing Market Index (HMI) for February came in at 55. The biggest change in the index came from a large drop in the component measuring sentiment on the traffic of prospective buyers; this measure dropped 11% from 44 to 39. While the HMI remains in solid territory (above 50), this component drop will be something to watch closely. {snip}
Source: National Association of Home Builders (NAHB)
As is if often the case, the National Association of Home Builders (NAHB) provided an unsatisfactory explanation for the change in numbers. This month’s explanation was borderline bewildering:
{snip}
At the time of writing the reaction in iShares US Home Construction (ITB) is relatively mild with a 0.3% drop. Overall, ITB is still riding a strong recovery from recent lows. It is still trading at near 8-year highs with a marginal breakout.
Source: FreeStockCharts.com
Be careful out there!
Full disclosure: no positions
(This is an excerpt from an article I originally published on Seeking Alpha on February 17, 2015. Click here to read the entire piece.)