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Saying that Real Estate is important to the economy is an understatement, to say the least! IYR created what looks to be a "Head & Shoulders topping pattern" back in 2006 to 2008 at (1) and in turn fell hard, the broad market did too.
In 2008-2009, IYR looks to have created a "Head & Shoulders bottoming pattern" at (2) and then proceeded to have a large rally and the broad market did too.
I am keeping a close eye on IYR at this time because a "Potential" head & shoulders topping pattern could be forming and the inset chart reflects a sharp decrease in the housing affordability index.
This pattern is NOT true or complete at (3) until the neckline would break to the downside so....at this time the jury is still out on this pattern. For sure worth keeping a close eye on!!!