The financial markets took a hit earlier this month, but exchange-traded funds (ETFs) continue to perform excellently. President Biden’s infrastructure plan has benefited numerous construction-focused stocks.
ITB Continues its Rally
The iShares U.S. Home Construction ETF (ITB) has been one of the best performing ETFs in its category in recent months. The fund has now hit a new 52-week high and could rally higher over the coming weeks.
The ETF tracks the performance of the underlying Dow Jones U.S. Select Home Builders Index, which is a subset of the Dow Jones U.S. Household Goods Index. The index is a free-float adjusted market capitalization-weighted index and measures the performance of the home construction sector of the U.S. stock market.
ITB has been rallying thanks to the increase in demand for new and existing homes in the face of increasing housing prices and supply-chain disturbances. As a result, home builders have benefited the most in this period. Interest rates have dipped on the Omicron variant of the COVID-19 fear.
ITB Could Rally Towards $90
At press time, ITB is trading at $80.89 per share, up by more than 2% during the previous trading session. The ETF has performed excellently since the start of the year, adding more than 45% to its value during that period. In the past month, ITB’s value has increased by more than 8%.
ITB’s technical indicators are looking positive at the moment, thanks to the fund’s latest performance. It is trading above its 50-day moving average of $72.69, while the MACD line is way above the neutral zone and into the bullish territory. The RSI of 70 shows that ITB is heading into the overbought region.
The iShares U.S. Home Construction ETF could continue with its recent rally and reach the $90 mark over the coming weeks. Its performance would depend on the demand for housing and the state of the supply chain sector.