Home Builder Stocks Powered Through Softening Housing Data – Housing Market Review (March, 2021)

Housing Market Intro and Summary Softening housing data pointed to more normalization in the housing market. Normalization is returning housing data to prior trends and in some cases suggesting important plateaus. Home builder stocks powered through the softening data to show strength in sharp rebounds and fresh all-time highs. The arrival of the Spring selling … Read more

Stocks Jumped and Never Looked Back As A New Administration Began – Above the 40 (January 20, 2021)

Stock Market Commentary The Presidential inauguration is a hallowed American tradition. The stock market celebrated the incoming Biden and Harris administration with new all-time highs on good trading volume. The start of a new American administration is as good a time as any to back down from my recent short-term bearish call. While this overbought … Read more

Record Confidence, Rangebound Sales and Stocks – Housing Market Review (November, 2020)

The iShares Dow Jones US Home Construction Index Fund (ITB) lost 1.4% as it continues to pivot around its 50-day moving average in an extended trading range.

Housing Market Intro and Summary A divergence in the housing market emerged between rangebound home builder stocks and strong housing data. In October, new home sales recorded a third straight month at the 1 million mark. Since new home sales hit the August peak, the stocks of home builders have also largely gone nowhere. A … Read more

Divergence in the Housing Market: Slowing Stocks vs Soaring Data – Housing Market Review (October, 2020)

Housing Market Intro and Summary A divergence in the housing market is emerging between slowing home builder stocks and strong housing data. The housing boom in the U.S. continued to make its mark in the middle of the pandemic-induced recession. While new home sales took a bit of a pause in October, housing starts, existing … Read more

Seasonal Trade In Housing-Related Stocks Launches with Key Tests

This week’s housing data were impressive. The Housing Market Index (HMI) for October reported another all-time for home builder sentiment. Subsequently, starts for single-family homes hit a fresh 13-year high. Yet, the stock market yawned. Housing-related stocks demonstrated rare signs of weakness not seen in a long time. Several stocks suffered breakdowns below their respective … Read more

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

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

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

Housing Downturn: V-Like Recoveries In Stocks Tug On Sluggish Data – Housing Market Review (May, 2020)

Housing Market Intro and Summary Could the housing downturn already be coming to a swift end? The stocks of home builders are delivering this message. They have enjoyed a very healthy rally and recovery from the depths of the March stock market crash. The challenges ahead are large: worsening economic conditions, unemployment at historically high … Read more