It has been a great run for the REITs in terms of the dividends collected by patient investors and especially the price appreciation for traders trading the trend higher. After yesterday’s nasty reversal in the IYR ETF, though, today we saw even more weakness amounting to downside follow-through. The IYR continues to lag the market this afternoon.
As a result, while not calling a generational top, I am looking for further weakness in the space in the coming weeks.
One name to note is CXW, a private prison play with a 5%+ yield. The stock has appreciated from single digits to over $40 since 2009. But now the weekly chart is forming a rare but potentially wildly bearish diamond topping pattern, indicative of bulls losing their grip to increasingly aggressive sellers. The pattern confirms below $34, but either way to chart looks exceptionally vulnerable to my eye as modern prisons are not so safe anymore.
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Chess
Thank you for this post! What is the upside target needed to negate this pattern $41.10? Many thanks for the awesome work you do and for your help.
Yeah above there and the diamond starts to crack
Well, if your cellmate is Jodi Arias…
LoL