The home builders sentiment index (HMI) stopped rising. This development should come as no surprise to our subscribers. We have been saying for a long time the housing sector was going to slow down.
Now the action of the HMI reflects the uncertainty about this crucial sector of the US economy. What is important, however, is that the HMI leads a major top in the market by about a year. Sometimes longer.
The fact that the HMI has been making little or no progress since 2013 is a sign of caution (click on the chart to enlarge it).
George Dagnino, PhD
The Peter Dag portfolio
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