thoughts on lumber futures

Yes, lumber futures. I hope this post doesn't leave you "board" ... er ... "bored" (sorry, couldn't resist). But I keep my eye on both lumber futures and oriented strand board prices as they can give you clues about where the housing market is going. When prices are rising, it indicates that demand is rising as well. That, in turn, signals that home construction and sales are going strong. The opposite is true when prices are falling.

Anyway, in the past couple of days, lumber prices have taken another dive. They're now retesting a key technical level ($260-ish) that has held several times in the past couple of years. If it gives way, it COULD signal a new leg down in the market. Only time will tell.

It's worth noting that we'll get August housing starts figures tomorrow. A strong number could turn the price tide in lumber, while a weak number could have the opposite effect.