A Housing Boom Rapidly Emerges from Recovery – Housing Market Review (September, 2020)

Housing Market Intro and Summary The pandemic recession ended for housing in July. August demonstrated that an all-out housing boom is underway. I was expecting the housing data to start normalizing. Instead, demand pushed ever higher and supply tightened further. Housing Stocks Toll Brothers (TOL) started last week with a preliminary report on net new … Read more

How to Buy Stocks Ahead of A Bursting Housing Bubble

Chasing bubbles is a dangerous game. Chasing a housing bubble is barely a game. The Case for a Housing Bubble On CNBC’s Fast Money, Tim Seymour led a segment called the “Mother of All Housing Bubbles.” I expected Seymour to make the case for shorting housing-related stocks. As a perma-bull on the housing market, I … Read more

Housing Market Evades the Pandemic Recession – Housing Market Review (August, 2020)

Housing Market Intro and Summary The pandemic recession is over as far as the housing market is concerned. The case for V-shaped recoveries was evident in the last Housing Market Review. The recovery completed in August with important new highs in existing and new home sales and in home builder sentiment. Ultra-low interest rates support … Read more

New Bearish Divergence Shreds the Stock Trading Script – Above the 40 (August 21, 2020)

AT40 (T2108) is dropping at a rapid clip despite the stock market's melt-up.

Stock Market Statistics AT40 = 60.6% of stocks are trading above their respective 40-day moving averages (DMAs) (ended 7 overbought trading days)AT200 = 42.7% of stocks are trading above their respective 200DMAs VIX = 22.5Short-term Trading Call: cautiously bearish Stock Market Commentary AT40 (T2108), the percentage of stocks trading above their respective 40-day moving averages … Read more

Housing Divergence: Full Recoveries, Uneven Earnings, Lagging Consumers – Housing Market Review (July, 2020)

Housing Market Intro and Summary The housing downturn ended almost as quickly as it began. V-shaped recoveries are evident across a spectrum of data, especially in home builder sentiment and new home sales. Home builders continue to describe extremely strong demand that, in many cases, goes beyond the release of buying power pent-up by the … Read more

Housing Sentiment Completes V-Shaped Recovery, Stocks Following

The Housing Market Index (HMI) soared to 72 in July. The 14-point move completed a V-shaped recovery in the sentiment of home builders. Unlike the reaction to the surprisingly strong June HMI, the reaction to July’s surprise was definitely positive. The Message in Home Builder Sentiment The National Association of Home Builders (NAHB) explained the … Read more

Stock Market Snaps Out of Bearish Divergence – Above the 40 (July 15, 2020)

Stock Market Statistics AT40 = 58.8% of stocks are trading above their respective 40-day moving averages (DMAs) AT200 = 30.8% of stocks are trading above their respective 200DMAs VIX = 27.8Short-term Trading Call: neutral Stock Market Commentary I anticipated a shallow sell-off for a downward resolution to the bearish divergence in the stock market. However, … Read more

Taylor Morrison: Stock Breaks Out On Strong COVID-19 Recovery

Taylor Morrison Home Corporation (TMHC) Taylor Morrison Home Corporation (TMHC) is once again doing its best to prove wrong my skepticism over its acquisition of William Lyons Homes. On July 8th, the company recorded strong sales performance as the housing market continues its swift recovery from the temporary economic shutdown forced by the COVID-19 (coronavirus) … Read more

Divergent Fortunes and Trends – Housing Market Review (June, 2020)

Housing Market Intro and Summary I asked in my last Housing Market Review whether the housing downturn could already be coming to a swift end. The stocks of home builders delivered that message and more and more earnings reports from home builders are apparently delivering messages of a sharp recovery. A widening divergence between existing … Read more

Near Overbought Trading Conditions Raise the Stakes On Stock Breakouts – Above the 40 (April 28, 2020)

AT40 (T2108) has effectively soared in a near parabolic move back to the overbought threshold.

Stock Market Statistics AT40 = 69.6% of stocks are trading above their respective 40-day moving averages (DMAs) 3+ month highAT200 = 14.8% of stocks are trading above their respective 200DMAsVIX = 33.6Short-term Trading Call: neutral Stock Market Commentary The stakes are ever higher. Right alongside confirmations of major breakouts from the major stock indices, AT40 … Read more