Well I bought a partial lot in both the XHB – Homebuilders SPDR ETF, and RYL – Ryland Group Inc.’s stock this trading session. These homebuilder equities have both been on fire, and are breaking out of some extended bases. The action in the stocks could be better, but I bought some of both today strictly because of that action.
I could be wrong, and that’s why I only held over a 1/3 lot, but it felt as if those in charge of these trading vehicles today were trying to shake out the longs. I actually like the fact that the stock and ETF didn’t extend themselves with closes at the day highs.
I’ll give both about a point stop from entry, which is under the previous daily trailing candlestick on each. That will be raised to the next trailing bar low the following day, if RYL and XHB aren’t stopped tomorrow.
You can see on the XHB weekly chart that the homebuilders are entering some open ground, after the steep slide the sector was hit with late last Spring. We’ll see how these swing trades play out in the next few days.
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