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Buzz & Banter


This afternoon I've been looking at charts of homebuilding stocks. In particular Lennar (LEN:NYSE), Beazer Homes USA (BZH:NYSE), Centex (CTX:NYSE) and Hovnanian (HOV:NYSE). For several weeks now I've been hearing how these charts resemble the technology charts of late 1999 and 2000. Well, they don't. What they do resemble are the technology charts of early 1998 when many of them first broke out of fairly significant bases and legged up rather quickly.

This is not a comment on Scott's concern that we may be in a housing bubble. I happen to agree with him that all the ingredients for a bubble in the housing market are there. But, as usual, it's a matter of timing. Right now, on a technical basis, longs in this group look easier to manage from a risk perspective than shorts.
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No positions in stocks mentioned.

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