The overall building group can reveal valuable clues about not only the health of the economy, but the vibrancy of the consumer. DHI jumped more than 11% last week. EXP, a laggard rose more than 5.5% after a well received earnings report. USG is has galloped higher by 16.5% the last couple weeks. FIX has advanced more than 17% the last 2 weeks. Below we look at some other names that depend on a strong housing market. Perhaps this group is trying to tell us something.
In our Monday 7/13 Game Plan we looked at HW. Tuesday the stock gained almost 9% after a well received earnings report. It is now trading near 8 year highs and the round 20 handle came into play as their were no weekly CLOSES above it (daily CLOSES above were 5/14, 5/18-19). The stock is looking for a 4th week up in the last 5 following a bullish piercing line the week ending 7/10. HW took out the 50 day SMA on 7/20 up more than 6% on well more than double the daily average volume and Tuesday screamed past the double bottom trigger of 20.09.
Stocks that can be entered after numerous positive reversals are HW. HW is a building periphery play which is higher by 24% YTD and 32% over last one year period. Two consecutive earnings beats of 5.5 and 3.7% inspire confidence after losses of 1.2 and 3.4% on 11/4 and 7/29. This week recorded a bullish piercing line week and the stock has CLOSED positively 5 of the last 6 sessions. Fridays action resembled a nice frypan bottom candlestick pattern. HW has lost ground 6 of the last 9 weeks, but started 2015 powerfully with an 11 week winning streak between the weeks ending 1/30-4/10. Enter here then add to above the 50 day SMA with a buy stop above 19.10 and then through a double bottom pivot of 20.09.