I’ve been pounding the table on the rotation back into homebuilders for months now — it’s been one of my highest-conviction themes this summer.
And today, I finally got the confirmation I’ve been waiting for.
The entire sector caught fire and rallied hard on the heels of some big earnings reports.
When we look under the hood, the largest homebuilder, $DHI, stole the show.
D.R. Horton just printed its best single-day gain since the great financial crisis after delivering a massive beat this morning.
These types of momentum thrusts — especially from a name like DHI — usually show up right as a new leg higher is getting started.
And let’s be clear: DHI isn’t just another housing stock. It’s the bellwether.
The largest and most important player in the group.
If the leader is breaking out on the heels of earnings, odds are the rest of the space will follow.
There are many more earnings catalysts underway for this subsector over the coming weeks, and if today was any indication, they should be tailwinds.
Today’s move is the kind of strength I want to see from one of the most critical cyclical groups in the market.
We’ve been positioned for this. We’ve been holding long DHI calls in Breakout Multiplier for weeks now — and after today’s move, those positions are up roughly 440% and 260%, respectively.
This is what happens when the right vehicle lines up with the right setup.
