A new play in Real Estate: Stag Industrial

Interactive Brokers’ Trader's Insight

Using Trading Central’s Technical Event® screener, our analyst Gary Christie, searched for interesting setups in the real estate sector.

The real estate sector has been one of the best performing sectors of the year, returning an impressive 15% year to date. Real estate stocks have benefited after the Federal Reserve said they intend to remain patient in determining when to make future changes in its benchmark interest rate. Low rates are positive for real estate stocks. Using Recognia’s technical event screener, I searched for real estate investment trusts that have a bullish technical pattern, 15% potential gain and min volume of 100K to help with liquidity. 

Stag Industrial Inc (STAG: NYSE) caught my attention as prices confirmed an “Upside Breakout”

Stag Industrial Inc is a real estate investment trust primarily involved in the acquisition and operation of single-tenant industrial properties throughout the United States. The vast majority of the company's real estate portfolio is comprised of warehouse and distribution buildings. Most of these facilities are located in Midwestern and Eastern U.S. states. Stag Industrial derives nearly all of its income in the form of rental income from its portfolio of warehouse and distribution properties.

Prices broke upward out of a trading range, suggesting we're entering a new uptrend.

The Upside Breakout pattern represents a trading range in which prices move sideways between two parallel horizontal lines. It's often a pause or congestion area within an existing trend, though sometimes the breakout results in a reversal to the prior trend. Either way, an upside breakout through the upper resistance line signals an end to the consolidation period and the start of an uptrend.

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