Good Tuesday afternoon, everybody. Well, it looks like I was right and wrong about July's housing starts and building permits data. I was right in the sense that the data did end up being less than ideal from some perspectives. But, I was wrong - fortunately - in my guess that it would adversely impact homebuilding stocks today. The market chose to see the glass as half full, and pushed homebuilder stocks to new multi-year highs. You know what though? I want to go ahead and take action on the sector anyway, even though we technically widened our gain. First things first... the data. Last month, the U.S. saw housing starts reach a pace of 1.206 million, versus expectations of 1.2 million. Building permits of 1.119 million, though, fell a little short of expectations for 1.275 million. Starts hit a multi-year high, though just barely, while permits slipped back to the lowest pace we've seen since March. Even so, I still see the permits trend as a bullish one overall, with May and June's soaring permits more than offsetting the lull. In that light, I can understand why homebuilder stocks were up a solid 2% today while the overall market floundered. For what it's worth, though we don't have any other real estate data from July yet, here's the rest of that data through June. We'll get existing home sales on Thursday, and we'll get new home sales data next week. Even through June, however, we can see there's a broadly-improving buying trend, and not a flood of inventory. Indeed, I can't help but wonder if an increase in inventory would actually increase the number of purchases. Now, based on the data thus far, it's easy to like homebuilder stocks more today than we liked them yesterday. Having had a day to think about it though (and a night to sleep on it), I'm going to do something unexpected here - let's close out our bullish call on homebuilding stocks. We suggest whatever you gains you may have reaped from our January 29th call be locked in. We're headed to the sidelines. You read that right. We're closing out our hypothetical trade on homebuilders, locking down what should be a hypothetical gain of 18%. Depending on how you played it, you could have done even better. I'm willing to guess some of you are wondering why in the heck would we jump off a train that's moving higher. There's a good reason. This looks to us like one of those times where things can't get any better. As John Monroe over at the Elite Opportunity has said so often (and made good money thinking this way), the time to buy stocks is when nobody wants them, and the time to sell stocks is when everybody wants them. Everybody wants homebuilders today. Besides, the Dow Jones Homebuilder Index (DJUSHB) we used as the proxy for our "trade" visually looks overbought. Take a look. It seems to be testing the upper edge of a long-term bullish trading range (dashed). Just for the record, we're not turning bearish on the group. We're just saying there's not a lot of near-term upside left right now. There is, however, a group we think is worth a closer look right now. Time to Travel I know we had other mental industry-based trades on our plate, but honestly, it's been so long since we've gotten a chance to look at any of them, I've forgotten what most of them were. I am willing to bet, however, the bulk of them were knocked out by some of the recent market pullbacks we've seen over the course of the past few weeks. Let's just assume the slate is clean except for today's addition of travel and tourism stocks, which have been strangely strong of late while most everything else is tepid. This is first and foremost a technical based trade using the Dow Jones Travel and Tourism Index (DJUSTT) as our proverbial guinea pig. With just a quick glance the chart doesn't look like anything besides choppy. The longer one studies this chart though, the more bullish clues one sees. Not only is DHUSTT knocking on the door of a key ceiling at 576, it seems to be finding some pretty good support on the way up. In fact, it's already poked through the upper edge of a converging wedge shape (dashed). As for the names in this group, the BigCharts listing of constituents wasn't working when I checked it earlier today, but I know the grouping includes car-rental services like Avis (CAR), travel agents like Expedia (EXPE), and even gas stations like Travel Centers of America (TA). And to answer the next question, no, I don't think the price of oil has a lot to do with its recent past, nor do I think it will have a lot to do with its foreseeable future. Whatever the case, we're going to go ahead and put travel and tourism stocks in our mental portfolio. With all of that being said, I'm sure at least some of you are wondering why we can't just go ahead and pick a stock out of this group and simply call it a day. The reason is, we've delegated all of our stock-picking duties to the Elite Opportunity team, who - frankly - are a lot better equipped to make picks and maintain a portfolio than we can here in the free newsletter. The fact is, they have the time and resources to find new picks and juggle open trades, and we don't. By my count, John Monroe and his team have made 20 long-term picks this year alone, and 42 short-term picks. These are some good picks, too. For example, Kite Pharma (KITE) ended up being sold for a 63% gain. Not all of the EO's trades are that fruitful, of course, but it doesn't take very many big winners like Kite Pharma to really make big-time progress in your portfolio. The point is, you can continue to ferret out some good trading ideas using our industry analysis as a guidepost, or you can just go ahead and have the resident expert do the hard work for you... at a very reasonable price. Here's the deal, or cut and paste this link: https://www.smallcapnetwork.com/pages/SCNEO/v1/ Talk About Indecision! I'll keep this short and sweet today, mainly because there's just not much to say - stocks are not only on the fence, they're getting comfortable being there. Ugh. Since it's our usual focal point we'll start with the S&P 500's daily chart. Yesterday's rally effort fizzled pretty quickly, with the index closing right between its 50-day and 100-day moving average lines. The NASDAQ looks about the same, though it didn't even move above its 20-day moving average line yesterday. Either way, the 20-day and 50-day moving averages both still seem to be a problem area for the composite. The VIX and the VXN look equally quagmired, though I have to acknowledge the VIX seems to be working on an uptrend, guided by its 20-day moving average line. For the same reason we didn't want to get too bullish yesterday, let's not get too bearish after today. This is a wishy washy market in a wishy washy time of year. It could take a few days for stocks to pick a direction IF they're going to pick one at all. We still contend the S&P 500's 200-day moving average line at 2078 is the only bearish game-changer to worry about, while the upper Bollinger band at 2116 is going to make the bulls put up or shut up. In the meantime, the best place to be may be on the sidelines EXCEPT for select and proven ideas like the travel and tourism trend we spotted for you above. The very best trends are capable of overcoming marketwide stagnation. Most stocks, however, will simply do whatever the market is doing. That's why you've got to be selective in this kind of environment. We'll just have to see how it all shapes up.