by Dave Kranzler, Investment Research Dynamics:
The homebuilder stocks staged a dead-cat bounce higher this week. I have been saying that the builders were very oversold and would likely engage in a sharp short-squeeze rally. Today’s huge short-squeeze move – see this link – in the entire stock market added fuel to the homebuilder’s spike up.
I mentioned last week that the builders were due for a technically “oversold” short term bounce. I also asserted that the builders typically rally into the NAHB homebuilder sentiment index and the housing starts report. Finally, I said a bounce up the 50 dma was likely and a continuation move to the 200 dma was possible.
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