Are U.S. lumber prices going to take another run at pre-housing crash levels? From a chartist’s perspective, the long-term up trend since the 2009 lows still looks bullish, with the big price vacillations establishing mostly higher highs and higher lows.
The price – which finished last week at $362.5 per 1,000 board feet – is above 50- and 200-day moving averages.
The 14-day relative strength index, a momentum gauge, is about 66, according to Bloomberg data, suggesting the latest rally is not particularly overstretched.
And, over the past 10 years, November has been the most bullish month, with lumber gaining an average of 7.9 per cent – though that does include the 31.7 per cent pop off the 2009 lows.
Underpinning lumber prices in recent years has been the improvement in the US housing market. The Case-Shiller House Prices survey will be published on Tuesday.