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The resilience of the IYR (ETF for the real estate sector), and particularly the REITs, continues to impress despite the plethora of reason to be cautious on the broad market. While the senior indices and many sectors have indeed suffered technical damage, the IYR has digested last week’s failed breakout remarkably well. Whereas the S&P 500 is hanging on for dear life down at its 150 day moving average, the IYR is nowhere close to that reference point on its own chart, instead coming to terms with the 50 day moving average.
Moreover, there is a faction of traders who believe that the real estate sector is an excellent leading indicator for the broad market. If that is the case, then we have a bullish divergence on our hands. To my eye, the IYR needs to hold the $60 level in order for the bullish divergence to persist.
I have also included a slew of long ideas within the Residential REITs, which seem particularly well set up here.
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AGNC a MReit is quite different then many of those in the reit sector. Really a different set of dynamics.
MReits have been very strong recently striving on the prospect of the extension of low rates and the assumption it will be some time before we are able to do anything with the GSE’s.
They should continue to outperform throughout a “soft patch”. Though AGNC isn’t my fav.
Interesting.
Looks like a short squeeze in CYS (MReit).
nice