LL Lumber Liquidators Daily Chart Sideways Channel Head and Shoulders Pattern Gaps

As the housing recovery talk continues this year, one trader after another runs into USG gypsum, and LL lumber, and flooring and other key components that support the housing boom. USG is on the short list on the Positions and Picks page. Keystone has already shorted USG once for a trade and it can simply be shorted at will right now.  Lumber Liquidators is a similar story. LL topped in November and continues to move thru the sideways 49-57 channel.

The coming days are important since if the right shoulder holds for the H&S pattern shown in neon blue; the target below is 40-41 at the gap fills. Since a higher high in price has not occurred since November, negative divergence cannot exist but the indicators are at lower levels than when price was moving up in August-October.  There is some near term juice left in the tank so price may come back up to touch the top rail.  Overall, projection is for lower prices moving forward with price falling out of the sideways channel as we move into spring time. Housing Starts this morning will impact LL. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here.  Consult your financial advisor before making any investment decision.

Note Added 1/17/13 at 9:40 AM:  LL receives a bounce due to blow-out Housing Starts numbers at 945K, highest in almost five years.