Don’t Panic over U.S. Housing

Danielle Shay joins Seema Mody on CNBC’s Trading Nation to talk about U.S. housing. Click the image above to watch the full segment.

The spring home-buying season took a bit of a hit, which is an outcome that some of us could’ve expected. Why? Because sellers didn’t want potentially COVID-19 positive people in their homes during a worldwide pandemic. It makes sense, I’d feel the same way.

However, we’re at a point now where parts of the country are beginning to open back up. In addition, there are still buyers who’ve kept their jobs throughout the virus and they’re likely going to shop for some low-interest rate sales, which is reflective in the data.

For a short term trade, I like trading the home construction ETF, ITB to the upside, along with the relative strength leaders. DHI which just broke resistance at the 200 SMA is looking good for selling put credit spreads and buying long calls. I’m looking for a break of the overhead resistance at the $30 price point for KBH and TOL which will likely rally into earnings.

In the longer-term, more economic damage is impending but for short term traders I like the upside here.

If you want to see my whole segment you can click here.

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