ONE-TWENTY TWO: Trading Financial Markets
Exploring the poetry in financial markets for students of money and economy since the year 2000.
During its earnings call, LGI Homes (LGIH) projected strong performance ahead. The company’s December home closings report delivered. LGI Homes closed 748 homes last month. The 49.6% year-over-year growth contributed to an 18.0% year-over-year overall growth rate in home closings for the first eleven months of 2019. The stock market responded positively by sending LGIH … Read more
Housing Market Intro/Summary When I wrote the Housing Market Review for October, the stocks of home builders were failing their moment of truth. The iShares US Home Construction (ITB) soon rebounded, including a near picture-perfect test of support at its 50-day moving average (DMA). Last week, ITB actually printed a fresh 21-month high before pulling back. … Read more
AT40 = 58.7% of stocks are trading above their respective 40-day moving averages (DMAs)AT200 = 55.4% of stocks are trading above their respective 200DMAsVIX = 11.9Short-term Trading Call: neutral Stock Market Commentary If “cautiously neutral” made sense, I would make that description my short-term trading call. Last week’s trading action motivated me to observe that … Read more
AT40 = 53.7% of stocks are trading above their respective 40-day moving averages (DMAs)AT200 = 52.7% of stocks are trading above their respective 200DMAsVIX = 12.3Short-term Trading Call: neutral Stock Market Commentary The S&P 500 (SPY) pulled back slightly last week as the stock market’s underlying bearish divergence finally proved too heavy. Yet, the pullback … Read more
Overall Assessment The stocks of home builders have had a banner year. The failure of the iShares Dow Jones Home Construction ETF (ITB) right at the climactic high of January, 2018 exposed a change in sentiment at an important juncture. So far, M.D.C Holdings (MDC) has suffered one of the most damaging changes in sentiment. MDC … Read more