Over the last month, homebuilder DR Horton (DHI) has climbed 177 positions in the SIA S&P 500 Index report up out of the red zone and back into the Green Favored Zone for the first time since May. Yesterday it moved up another 4 spots to 89th place.
Between May and October, DR Horton (DHI) shares were under steady distribution but have turned things around in recent weeks. Since bottoming out in October, DHI has been recovering lost ground, and the technical situation has improved with the shares regaining their 50-day average, staging an upward gap and snapping a downtrend on their road to recovery.
A major breakout is now underway with the shares clearing their May peak near $103.00. Measured moves from recent trading ranges suggest next potential resistance may appear near $118.00 and then $123.00 on trend. Initial support appears between $98.00 and the $100.00 round number.
For over 18 months now, DR Horton (DHI) shares have been steadily advancing in a step pattern of high pole rallies, followed by periods of consolidation at higher levels. The shares spent the last six months in a consolidation phase which ended in a false breakdown back in October. Since then, the shares have resumed their upward course, first completing a bullish Double Top pattern and regaining $100.00, then breaking out to a new all-time high this month and completing a bullish Spread Double Top pattern to signal the start of a new rally phase.
Horizontal and vertical counts suggest initial upside resistance tests near $118.65, and then $126.85. Initial support appears near $98.16 based on a 3-box reversal, or the $100.00 round number.
With its bullish SMAX score increasing to a perfect 10, DHI is exhibiting strength across the asset classes.
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