Housewarming Present:

The consumer discretionary group has been aided over the last one month period by the home construction and home improvement retailers. Those are both easily the best subsectors within the space on that time frame. Below is the chart of the ITB and one can see it has had a nice run and is trying to bull flag just below the 80 number. Focus on the leaders within and a good place to start is SKY which is higher by more than 100% in 2021 thus far. The stock is also bull flagging near the 80 number here and is acting very well POST breakout above a cup base pivot of 66.92 taken out on 11/3 (was the stocks SIXTH very firm positive earnings reaction). The name is 7% from the most recent 52-week highs, and of course, there is bifurcation in the group with PHM still in bear market mode 22% off its peak made in May. If it can get above its 200 day SMA while it hovers near the very round 50 number it could be a good start to building the right side of a potential cup base. A WEEKLY break above 80 for the ITB could be an early holiday gift for shareholders of the builders.

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