The popular home-builder sector remains weak despite lower bond yields. The iShares U.S. Construction ETF (ITB) remains below its important 50-day moving average. This puts this industry group in a weak technical position on the charts. At this time, the iShares U.S. Construction ETF (ITB) still has some minor daily chart support around the $66.00 level. This is where the iShares U.S. Construction ETF (ITB) was defended on June 17th, 2021. Should this level fail to hold as support on a closing basis then it will signal another decline in the sector. Some of the leading stocks in this industry group include Toll Brothers Inc (TOL), Lennar Corp (LEN) and DR Horton Inc (DHI). All of these stocks are following a similar pattern to the iShares U.S. Construction ETF (ITB).
The next major support level for the iShares U.S. Construction ETF (ITB) is around the $58.00 area. This support level is where the iShares U.S. Construction ETF (ITB) broke out in March 2021 from a long 7-month base. When an equity backtests its old breakout point it will usually be defended by the institutional crowd. This would be an area to look at this important sector on the long side again.
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