Not Buying Yesterday's Bullish Moves in Homebuilders

The media tried to put a bullish spin on the housing data yesterday morning and justified yesterday's bullish move by saying the bottom is in and the data couldn’t possibly get any worse. When I look at the XHB I see a very bearish chart pattern and yesterday's 3% move did nothing to suggest otherwise. In fact, we’re seeing a rejection at its 200 day moving average, lower highs/lows and high volume sell off days. This is a recipe for lower prices if I’ve ever seen one and yesterday's move just worked off some of its oversold condition.

I very much doubt this rally can continue much more without strength in this sector. Even the XLF is looking very weak when you look at it on a daily chart pattern.

I’m sure most got caught by yesterday’s strength and I’m very thankful I sold off half of my contras at the open and the rest for breakeven or yesterday would have been brutal for me.

Comments

[apppro:]

Not buying it! Does that really matter anyway? For me, this one word in your title sums it up: "Yesterday's". This trader mentality is what's really wrong here, and whether the home sales are up slightly or down slightly really won't matter, that is until we rid ourselves of this minute by minute mentality, and most importantly put an end to "The Shorting of America".

May 27 07:06 AM

[jeandit75:]

Ok appro, then let's forget the yesterday but still I can give you 20 reasons for shorting the real estate market which are not related to technicals. However you look at this market, its getting worse by the minute.


On May 27 07:06 AM apppro wrote:

> Not buying it! Does that really matter anyway? For me, this one word
> in your title sums it up: "Yesterday's". This trader mentality is
> what's really wrong here, and whether the home sales are up slightly
> or down slightly really won't matter, that is until we rid ourselves
> of this minute by minute mentality, and most importantly put an end
> to "The Shorting of America".

May 27 10:33 AM

[cash:]

Yes, just go long! Goldman Sachs and their cohorts are eagerly awaiting to 'appropriate' your money, 'apppro'

May 27 12:05 PM