A Weakening Foundation in MDC

Pending home sales were higher by just 0.3% in September, as reported by the National Association of Realtors, while closings fell for the month. The iShares Dow Jones U.S. Home Construction (ITB) ETF was down 2.9% in recent trading, and the modest recovery ahead may have an increasing headwind in the form of rising interest rates.

TBT -- Weekly Source: StockCharts.com View Chart » View in New Window »

The weekly chart of the ProShares UltraShort 20+ Year Treasury (TBT) ETF is showing a positive technical divergence. Since the end of last year the price has been closely reverting around its 50-day moving average, and the percent difference between the 50-day and 200-day lines has narrowed. There has been some price stabilization in the TBT since the June low, as there has been in the past, but this time it is being accompanied by a positive technical divergence. The moving-average convergence-divergence indicator has been tracking higher this year even as the TBT has moved lower. In addition, the relative-strength indicator is above its 21-period signal average and nearing its centerline, and Chaikin Money Flow has turned positive....155 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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