Fannie Mae-No Politics (FNMA)

[10bambam]

Time to Buy the Year's Worst?


http://www.forbes.com/sites/tomaspray/2014/07/10/time-to-buy-the-years-worst/


The DJ US Mortgage Finance Index (DJUSMF) has lost just under 11% so far this year. It includes Fannie Mae (FNMA) and Freddie Mac (FMCC).


The daily chart shows that after the January drop, the index has been in a trading range, lines e and f.
There were three attempts to push above the 6.50 area before the index turned lower.
The drop back below its 20-day EMA suggests a test of the daily starc- band in the 6.10 area.
There is further support now at 5.92, line f.
The sideways pattern in the relative performance (lines g and h) is consistent with an industry group that is lagging the overall market.
The trading range in the OBV has already been completed as it dropped below support (line j) at the end of June.
This suggests that the index may soon also drop to new correction lows.