When The Group Moves, Here’s What Can Happen
Despite November home sales up 5.9 percent on a
year-over-year basis, just about every homebuilder was heavily red this morning.
The average person is thinking ‘this is a good thing,’ and that the home
building stocks are probably going up. Not TradersWire subscribers, who got this
post:
10:21:07
Sector Update
The homebuilders are weak again today. Look at Lennar (LEN),
KB Homes (KBH),
Centex (CTX),
Beazer (BZH),
and Hovnanian (HOV)
for possible setups soon.
Minutes later, the sector began heading lower,
with KB Homes falling a steady .60 over the next 1/2 hour. Shorting contra-trend
rallies in weak stocks such as this can be a very profitable strategy. Stocks
don’t typically turn around on a dime; you usually have to wait for a more solid
signal.
See you tomorrow,
Brice
Â