DHI is a top five S&P 500 gainer today.

Homebuilder D.R. Horton is surging following a very solid Q3 earnings https://www.zacks.com/stock/news/453882/dr-hortons-dhi-q3-earnings-amp-revenues-top-estimates?cid=CS-MKTWTCH-HL-analyst_blog|earnings_article-453882&mod=mw_quote_news , report.

DHI is up 5.5% at mid day and is once again bumping up against heavy resistance just above $46.00. Back in in late April a disappointing Q2 report sparked an ugly breakdown gap. Heavy gap resistance at this area capped the multi week June highs as well as the initial July peak. The stock may finally have the momentum to power through.

A close above $47.00 would clear the April highs. Once past DHI has plenty of room to run before entering overbought territory. Solid support is in place between $46.00 and $45.00. We consider the stock a low risk buy near current levels. On the downside a close back below $43.00 would violate last week’s low sending a clear warning sign.

At time of publication we do not have a position in DHI.