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Actionable news in DHI: D.R HORTON Inc,

How to Trade Volatile Homebuilder Stocks Using Technicals


Homebuilders D.R. Horton (DHI - Get Report) , KB Home (KBH - Get Report) , Lennar (LEN - Get Report) . PulteGroup (PHM - Get Report) and Toll Brothers (TOL - Get Report) show mixed stock performance, as sentiment improves but single family home starts lag behind normal levels. The stocks have reasonable gains so far in the fourth quarter, led by Lennar. But on a year-to-date basis, only three are winners, led by D.R. Horton.

These stocks can be traded using good till canceled limit orders to buy on weakness to a key technical level below the market, or using GTC limit orders to sell strength to a key technical level above the market. This strategy captures the volatility that occurs following housing data or...