Today the major stock market indexes are all in rally mode as the U.S. Dollar Index makes another new multi-month low. However, the home-builder stocks are not participating and this is a sign of weak relative strength.
Toll Brothers Inc.(NYSE:TOL) is trading lower this morning by 0.02 cents to $18.73. While this is not major decline it is a sign of weak relative strength compared to the major stock market indexes. Toll Brothers Inc. will have daily chart resistance around the $20.00 level should the stock rally over the next week or so. The daily chart support levels for the stock will be $18.00 and $17.25 in the near term.
Lennar Corp.(NYSE:LEN) is trading lower by just 0.04 cents to $15.32. Again, while this is not a major decline in the stock it is a sign of overall weakness in the sector compared to major indexes. This stock will have daily chart resistance around the $16.00 level should it catch a bid and rally. The daily chart support levels for LEN will be around $14.00 and $13.25.
Whenever the major stock market indexes rally and some sectors do not participate this should be noted. This is usually a sign of weakness and these stock could lead the markets lower when the rally ends. The home-builder stocks have been laggards since 2006 and still remain weak at this time.
