Residential Update

This morning brought bad news to the residential sector; mortgage applications decreased 18.6% last week and refinancing fell even sharper to -24.6% from the prior week. 


FULL STORY HERE


Here are some charts of stocks that have been on the trade/watchlist




SRS

 Above on the 5 min 3C chart you can see the pullback in SRS (short on Real Estate) and recently the accumulation taking place.

 Here's an intraday chart showing what also appears to be a rounding bottom

And here is the bullish descending wedge in SRS. You can see that today it found support. SRS remains one of my favorite ETFs to play weakness in housing.


Some of the real estate REITS on the trade-watchlist include:

SNH, BRE, CLP, SPG, GGP and SLG

Here are some of their charts today, it appears their bounce is ending.

 BRE is in a downtrend-note the lower highs, lower lows. Also today's candlestick is a shooting star reversal candle.

 CLP also showing a shooting star reversal candle at what appears to be the end of the bounce.

 GGP is even worse, the candlestick today is a bearish engulfing pattern, gapping up this a.m. and swallowing yesterday's range.

 SLG -Another shooting star.

 SNH is another in a deep downtrend, the bounce appears to be over as we see another candlestick-shooting star reversal. Also note the volume declining into the bounce. 

SPG, another with declining volume into the bounce-this is bearish volume activity and the shooting star here suggests the bounce is coming to an end.

One way to play any of the above REITS is to enter the short trade on them and place a stop at the highs of today, that way you have a fairly high probability trade with fairly low risk.