Real Estate stocks and REIT’s have been crushed over the last two weeks. This has been a fantastic drop which has taken any investor who bought in the last three months and said screw you. Profits have turned to losses. Three months of vertical gains wiped out in days. A punch right to the belly of investors who follow the media and their brokers blindly.
While the average investor is panicking like they have a bee in their underpants, smart investors and traders are licking their lips. This drop is nearing major support and a big bounce in on the horizon. Let’s look at some key stocks and REIT’s below and find their levels.
1. Simon Property Group, Inc (NYSE:SPG) – This stock is down from a 52 week high of $182.45 to $166.13. The major support area for a bounce is between $164.00 and $161.00. This is a huge area of support and a bounce back to $170.00 would be likely.
2. HCP, Inc. (NYSE:HCP) already hit the 200 moving average on the daily chart. There is insane support and the stock is already bouncing nicely. It fell from a 52 week high of $56.06 to a low today of $46.75.
3. Realty Income Corp (NYSE:O) has fallen from a 52 week high of $55.48 and is now trading at $44.69. This 52 week high was made just two weeks ago. The stock is nearing its daily 200 moving average and pivot low support level of $43.85. This is the spot if it hits in the next few days. Great support with a major bounce likely.
Just on the basis of a technical dead cat bounce, these stocks will bounce. Many of these are down close to 20% in a few weeks. It is a simple over reaction to the increase in the 10 year rates. This would be a near term trade and not a long term investment. Long term investing is for suckers who like to give money to the institutions.