Can You Say D-u-l-l?
This was one of
those days that you just file
away in a drawer, never to return to, never to think about.
Just dull, very dull.
Beneath the surface, the builders have
been a top performer.
The problem with groups like this and
some of the retailers, is liquidity.
Or the lack thereof.
One builder that sets up — for swing
traders, not intermediate players — is Lennar
(
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of a four-week zone failed last week…thus far, the pullback has been shallow
and on dimming trade…watch for another attempt at a new high…the liquidity
is there, with market cap at $2.4B.
Often, second entry can be a
lower-risk play than first entry.
A step behind Lennar is Kaufman &
Broad
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PowerRating), another builder ($1.4B cap) working on a four-week range…this
one has more work to do, and not as strong technically as LEN.
I wouldn’t expect giant moves from the
builders, given their far-from-outstanding earnings growth and the fact that
they’ve already packed some nice gains.
In light of the latter, as well as the
brevity of their consolidations, this group makes much more sense for the swing
trader than the medium-termer.
In the “old days,” the
housing industry used to lead the economy into and out of recession, what with
its effect on many other industries, including steel, copper, lumber, durable
goods (including appliances), home furnishings, savings & loans, consumer
finance, etc.
These days, as we have learned,
nothing is sacred — both fundamentally and technically.
Which is all the more reason why the
market will continue to reward the participant who abides by the rules of
trading.
That is, above and beyond anything
else, one must keep his or her eyes on the ball, and not on opinions, hearsay,
gossip, or headlines.
The regional banks are another top
performer…this, due to the rate picture as well as consolidation within the
industry.
Summit Bancorp
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SUB |
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being taken out by FleetBoston Financial
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last week on big turnover.
Meanwhile, FleetBoston is building a
nice-looking four-month base…its RS line already reached virgin turf last
Wednesday.
Suntrust Banks
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STI |
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for the third day on thinner flow after completing the right side of its
seven-month cup.
In the oil patch, BJ Services
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BJS |
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gapped up on high volume as it readies a test of its high of three weeks ago.