Home Builders Take A Hit: I Like LEN
InTheMoneyStocks.com | Aug 13, 2018 02:00PM ET
Most of the leading home-builder stocks came under selling pressure on Monday. Builders like Lennar (NYSE:LEN), Toll Brothers (NYSE:TOL), DR Horton (NYSE:DHI) and others traded lower by more than 3 percent. Many investors are blaming the recent Redfin (NASDAQ:RDFN) guidance for the decline in the home-building sector, but the industry group has been slumping since the start of 2018.h3 Have Patience/h3
Lennar is one home builder that has caught my eye. This stock topped out on January 22, 2018 at $72.17 a share. Since that high pivot, the stock has steadily declined lower throughout the year. On Monday, LEN traded down by $2.43 to $50.94 a share. Traders should note that the stock has been trading in a sideways range since mid May. This pattern tells me that there is one more move lower to go before LEN finds a defined bottom. Traders and investors must now watch the $45 area as the next major support level for the home builder. This is where the stock broke out in February 2017. Very often, prior break-out levels will serve as major support when retested.
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