Toll Brothers (TOL) – Toll Brothers is a homebuilding stock part of the ITB Home Construction ETF that is poised to work out of a weekly bull flag into year end. The group has seen some outperformance from key holdings like HD, LOW, and SHW but the home builder specific stocks in the sector could be the next stocks to play catch up as the sector continues to trend higher. Seasonally headed into November is a strong month of the year for ITB being up 9 of the last 10 years for an average return of +5%. Drilling down into the group, TOL becomes attractive based on the seasonality behind it and the strong bullish chart structure. TOL has traded higher in 8 of the 10 Novembers for an average gain of +6%. This is the best return of any month over this 10 year timeframe. While December has shown flat returns, January then has shown stronger outperformance also so potential for a multi month breakout move out of the weekly flag pattern. TOL is forming a strong weekly wedge right on top of the YTD VPOC support near 60. After a strong early 2021, the stock and other homebuilder’s stocks have consolidated for the last 6 months building up energy for its next move which likely resolves higher. Upside Fibonacci extension targets from the weekly chart likely point to 73 and 79 in the coming months into the start of the new year. TOL doesn’t see a lot of large dollar options trades but has several Jan 2023 call purchases in open interest from buys this summer, most notably the Jan 2023 $85 call bought on 8/27 for nearly $900k.