I just have some quick observations on a lot of charts today; they may all merit a closer look, so do with them what you will. We may come back and detail any or all of these at a later date.

Fun & Games

It was a few weeks ago we decided enough was enough on the Dow Jones Toy Index (DJUSTY). We foresaw a pretty good run late last year, but also told you the party was over early this year. Well, it hasn't happened yet, but the toy index may be getting ready for round two. As of right now, we're seeing support at the 200-day line, and resistance at the 100-day line. If we can break above the 100-day average at 373, we think this one has the potential to make another big run. Think Mattel (MAT) and Hasbro (HAS).

Dow Jones Toy Index (DJUSTY) - Daily


Homebuilders

It's no secret the homebuilders' stocks are in big trouble - and they should be. After peaking at 1120 in July of 2005, the Dow Jones Home-builders Index (DJUSHB) has deflated by more than 50%. However, there's a possibility things are about to get even worse.

Take a look at the chart. This index just hit new multi-year lows. More than that though, that move broke what to us looks like the neckline of a head and shoulders pattern. Theoretically, the index is now 'supposed to' fall the distance from the neckline up to the top of the head. However, if that happened, the index would reach all the way to zero, not likely (though scary if the theory is valid). While that may be more downside than we can reasonably expect, the shape of this chart is not a good omen. Take a look at KB Homes (KB) or Beazer (BZH); it's the same basic chart.

Dow Jones Homebuilders Index (DJUSHB) - Weekly


REITs

We've discussed REITs in a bearish forecast a couple of times now, and it looks like we were right. The chart of the Dow Jones REIT Index (RCI) looked like it was making a loose head and shoulders pattern of its own. Our signal, however, was going to be a cross under the 200-day line. Well, we got that, and more. The index is also under a long-term support line, with no real hint of buying interest from anywhere. Simon Properties (SPG) and Vornado (VNO) are the leaders of this big pack, for better or worse.

Dow Jones REIT Index (RCI) - Daily


Don't Hang Up Yet

There's nothing quite as good as plain old momentum, especially when it's consistent. The Dow Jones Telecom Index (DJUSTL) is a picture of both. We do indeed believe this party will end at some point, but for now, we have no choice but to assume this uptrend will continue. The recent pullback from the high of 196 back to 190 - where the 50-day line is - may be an ideal entry or re-entry point. AT&T (T) and Verizon (VZ) are the obvious industry icons, but there are a lot of worthy names in this group you may never have heard of. D&E Communications (DECC) and Centurytel (CTL) are two examples.

The Dow Jones Telecom Index (DJUSTL) - Daily


Price Headley is the founder and chief analyst of BigTrends.com.