Chart of the Day - Wednesday, May 28, 2025

🏆  Today's Chart of the Day was shared by David Keller (@DKellerCMT). 
 

• With two trading days left this week, Homebuilders ($ITB) are on pace for their lowest weekly close since November 2023, as the group has refused to participate in the broader market's recovery. 
   
• While the Magnificent 7 broke out from a Bull Flag yesterday, David notes that Homebuilders are breaking down from a Bear Flag, signaling continued pressure for Homebuilders and potentially the broader market.
   
• Homebuilders traditionally lead both the stock market and the economy. While other leadership groups, like Semiconductors, are breaking out, Homebuilders continue to scream risk-off. 
   

The Takeaway: Homebuilders ($ITB) continue to cast doubt on the broader market’s recovery, breaking down from a Bear Flag toward multi-year lows.