home builder stock update 2014

Are Home Builder Stocks Improving in 2014?

Love them or hate them, home builder stocks are an important part of both the economy, and the stock market.

And while we previously looked at the mysterious case of home builder stocks in 2014, the plot has thickened. So it’s time for an update…

Now here’s what you need to know:

Home builder stocks have under-performed the broader stock market since about 2007. And in particular, home builder stocks have vacillated back and forth for almost more than a year. But…

There are starting to be some signs that homebuilder stocks might be ripe for investing opportunity. Of course you’ll want to do your own due diligence. But some of these charts are starting to show signs of promise.

Notice how the major home building stocks (and indeed, the sector ETF) is starting to form a pattern of higher highs. The volume remains unconvincing, the housing recovery seems elusive (see this chart from Business Insider) and the economy looks anemic. But price is what pays.

So you’ll be wise to glance at these facts…

Home Building Stock Charts June 2014:

The following are the major home building stock charts. These are daily time frames showing the price action over the last year or so. You’ll notice that in the last couple weeks, all of the home building stocks have started to firm up. It’s hard to ignore this prominent example of top down trading.

June 2014 PHM Stock Chart:

PHM Homebuilder reversal

Has PulteGroup turned the corner? Or is this a temporary blip? Click to Enlarge.

June 2014 LEN Stock Chart:

LEN Homebuidlers reversal chart

Is LEN starting to trend higher? Or is this just a blip? (Click to Enlarge).

June 2014 TOL Stock Chart:

TOL Homebuilder correction

Can Toll Brothers turn around in 2014? Click to Enlarge.

June 2014 DHI Stock Chart:

DHI Homebuilders reversal chart

Will DHI continue to move higher in 2014? Click to Enlarge.

June 2014 XHB Stock Chart:

XHB Home builders reversal chart

The Home Builders Sector ETF (XHB) is looking strong going into the second half of 2014. Is this a new trend or another head fake? Click to Enlarge.

So could this be telegraphing an investing opportunity for homebuilder stocks in 2014? (Or is it time to short the rally?)

As you can see, homebuilding stocks are definitely at an interesting point. Whether you’re a housing bull or a big picture bear, you will want to know about this change of character in the price action of housing stocks so you can plan your next move.

And by The Way: If you’re not totally sure where to go from here, you may want to sign up for my free e-book, below. This will show you how to develop a hybrid technical and fundamental approach to improve your stock market decision making. You’ll also get updates each week sharing my favorite investing tips, tools and resources – all free! Why not give it a shot?

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