As we recently talked about, housing is hot right now.
Which seems kind of weird.
Aren’t mortgage rates rising?
Aren’t we about five minutes from a horrible recession?
Aren’t housing prices already too high?
Yes, probably, and yes.
But we don’t live in a sensical trading world right now. Up is down and down is up.
Trying to make sense of every trade could make our brains explode and miss trades.
Studies show it’s 62% more difficult to trade with an exploded brain.
So, in times like this, we need to put more weight on the charts.
And the charts say housing is scorching.
Take, DR Horton (DHI). It’s above the long-term moving average and it’s breaking above resistance (and breaking out of the famous cup-and-handle formation).
It could be an entry above $100.60:
And don’t forget about its cohort, PulteGroup, Inc. (PHM):
PHM is looking similar and is also near a possible breakout entry point ($60.90).
Housing has a lot of momentum right now. It might be smart to listen to what the charts are telling us.
Happy trading,
Scott
