not wonder about this chart...
Ugly Chart of the Day: Lumber As Housing Proxy
What is the best proxy for demand in the housing market?
How about lumber.
Here is one ugly chart, courtesy of finviz.com
(with trend lines added by the author):
For large graphic without added trend lines, click here:
Random length lumber started a down trend in 2004, well in advance of the top of the housing bubble. When a break out from the four year channel finally came in late 2009, it sure looked promising as a leading indicator for an upturn in housing. The sharp decline in the last two months, steeper than anything since 2004, brings the break out into question.
For large graphic without added trend lines, click here:
Random length lumber started a down trend in 2004, well in advance of the top of the housing bubble. When a break out from the four year channel finally came in late 2009, it sure looked promising as a leading indicator for an upturn in housing. The sharp decline in the last two months, steeper than anything since 2004, brings the break out into question.
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