Home Construction ETF (ITB) hits lower rail of channel and gets bullish signal
The housing industry has been pointing to a recovery for several months now and with the Fed expected to cut interest rates at the July FOMC meeting that should only help the turnaround. The iShares U.S. Home Construction ETF (NYSE: ITB) has been trending higher since the December low and a trend channel has formed since the beginning of the year.
The low closes from January, March, and last week connect to form the lower rail of the channel while the upper rail is less organized. The swings within the channel have been good for 8% to 12% upward moves and they have started with the stochastic readings in oversold territory and then making a bullish crossover.
The Tickeron Trend Prediction Engine generated a bullish signal for the ETF on June 28. The signal showed a confidence level of 88%. The signal calls for a gain of at least 4% over the coming month while 95% of past predictions on the ITB have been successful.
The housing industry is one of the most interest-rate sensitive industries. With growing pressure on the Fed to cut rates, the Chicago Mercantile Exchange Fed Prediction tool was showing a 65% probability of a 25 basis point rate cut.
Momentum Indicator for ITB turns positive, indicating new upward trend
ITB saw its Momentum Indicator move above the 0 level on June 26, 2025. This is an indication that the stock could be shifting in to a new upward move. Traders may want to consider buying the stock or buying call options. Tickeron's A.I.dvisor looked at 79 similar instances where the indicator turned positive. In of the 79 cases, the stock moved higher in the following days. The odds of a move higher are at .
Technical Analysis (Indicators)
Bullish Trend Analysis
The Moving Average Convergence Divergence (MACD) for ITB just turned positive on June 23, 2025. Looking at past instances where ITB's MACD turned positive, the stock continued to rise in of 50 cases over the following month. The odds of a continued upward trend are .
ITB moved above its 50-day moving average on June 23, 2025 date and that indicates a change from a downward trend to an upward trend.
The 10-day moving average for ITB crossed bullishly above the 50-day moving average on June 30, 2025. This indicates that the trend has shifted higher and could be considered a buy signal. In of 15 past instances when the 10-day crossed above the 50-day, the stock continued to move higher over the following month. The odds of a continued upward trend are .
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where ITB advanced for three days, in of 318 cases, the price rose further within the following month. The odds of a continued upward trend are .
The Aroon Indicator entered an Uptrend today. In of 271 cases where ITB Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are .
Bearish Trend Analysis
The 10-day RSI Indicator for ITB moved out of overbought territory on July 11, 2025. This could be a bearish sign for the stock. Traders may want to consider selling the stock or buying put options. Tickeron's A.I.dvisor looked at 41 similar instances where the indicator moved out of overbought territory. In of the 41 cases, the stock moved lower in the following days. This puts the odds of a move lower at .
The Stochastic Oscillator has been in the overbought zone for 2 days. Expect a price pull-back in the near future.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where ITB declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
ITB broke above its upper Bollinger Band on July 01, 2025. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
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