Sunday, June 4, 2023

US Home Construction Review $ITB #HomeBuilders - The Majority Is Clueless

US Home Cons Review
Trading noise, the random movement of price over the short term, does not control trends, cycles, and profits. The majority, an emotionally driven group focused solely on price, often interprets it as meaningful information. This leads to confusion, frustration, missed opportunities, and leaves the majority as the bag holders of trend transitions. The Evolution of the Trade helps investors stand separate from the majority.

The US Home Construction's overall trend, revealed by trends of price, leverage, and time, are defined in The Matrix for subscribers.

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The Economy & Stock Report (E&S), a series of videos, extends the discussion.

The Internet is a great source of opinion. Few people do their homework, and most let their belief structures influence their interpretations.

One of the favorite narratives for permabears is rising rates are bad for stocks and real estate (home builders). The previous cycle (last 30 years) trained the public to associate rising rates will be bad for all financial assets. A quick spin on Fin Twit reinforces this belief structure (see Tweet Below). A little research shows that the invisible hand does not respond to this belief. The means the majority is setting up to be played like the fool and bag holder. Bag holders have strong opinions, rarely research assumptions, and cannot adapt to unexpected price moves.

The Internet talks a lot. Bold and stupid talk generates followers.

What's wrong with the bubble narrative?

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US Home builders ETF ($ITB) flipped up 6 months ago. This initial discussion took place 6 months ago in 01/27/23 US Home Construction Review. Take a look, and learn to respect the invisible hand. We recall few did at the time. $ITB, a primary trend that's produced 11% gross profit, appears ready to continue. R in the phase column, and painted yellow in the Matrix as the three time frames return to Triple Up.

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The Matrix provides market-driven trend, cycles, and intermarket analysis.