Housing is perhaps the one industry that everyone has an opinion on -- bullish, bearish or neutral. I would bet most people base their housing viewpoint on their local region rather than a wider national outlook. Let's take a look at KB Homes (KBH) .
In this daily chart of KBH, above, we can see prices are above the rising 50-day and 200-day moving averages. KBH has risen from just shy of $9 in January to over $16. The On-Balance-Volume (OBV) line has been rising and confirming the price strength. Right now there is a bearish divergence in June and July as prices make higher highs, but the momentum study makes a lower high, telling us the upward rate of change of prices has slowed. A bearish divergence can often foreshadow a turn to the downside.
In this weekly chart of KBH, above, we can see prices are above the 40-week moving average line. The 40-week average line is just starting to turn higher. The weekly OBV line is rising strongly and confirms the price advance with heavier volume being traded in the weeks when KBH has closed higher. While these observations sound bullish, we can also see a great deal of overhead resistance between $16 and $20 that is likely to impact the ability of KBH to rally further. KBH could pull back to retest the $15 level and then we'll have to see what happens after that.