- Better be careful with homebuilders. Today LEN misses w/ weak margins. KBH missed with tighter margins as well earlier this week and got hit hard.
- Homebuilders are using more incentives to sell. Keeps home prices inflated but cuts into margins. Same thing happened before housing bubble collapse. Housing prices are about to drop significantly imho. Also Fannie/Freddie guaranteed mortgage loans requiring only 3% down payment is a default disaster waiting to happen.
- Technically the weekly XHB looks like it is putting in a reversal candle suggesting that was a false breakout a couple weeks ago.