Chart of the Day - Tuesday, October 7, 2025

🏆 Today's Chart of the Day was shared by Donovan Jackson (@TheDonInvesting).
 

• Homebuilders ($ITB) are under pressure this week, with $ITB logging its worst two-day drop since April, falling -2% on Monday and another -3% today.
   
• Donovan notes that $ITB has rolled over into a potential Head & Shoulders Top over the past two months. The “head” formed in September following a failed breakout above the 61.8% Fibonacci retracement.
   
• Breaking above the right shoulder ($110) would invalidate this bearish setup. Failed tops are notoriously bullish, but if the damage isn’t repaired soon, it could signal a larger issue, as Homebuilders tend to lead the broader market.
   

The Takeaway: Homebuilders ($ITB) just suffered their worst two-day drop since April, with $ITB shedding -5% to start the week. This key industry group is sending a bearish message to the broader market as it threatens to complete a two-month top.