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View Full Version : Are there psychological levels in the Dow?


Simon Willard
02-01-2011, 08:33 PM
The Dow has finally cracked the all-important psychological level of 12000. At least that's how some reporters would say it.

Is there any hard evidence? Does anyone know of any data that would show that the round-number thresholds like 12000 have any real meaning to the market?

Simon Willard
02-03-2011, 12:35 PM
For the claim, see http://en.wikipedia.org/wiki/Psychological_level:

"When such price is reached by the specific security, commodity or a derivative, the tendency of the financial market participants (traders, market makers, brokers, investors, etc.) is to observe the number and act on their positions (either to buy, sell or hold)."

TwinSwords
02-03-2011, 07:07 PM
For the claim, see http://en.wikipedia.org/wiki/Psychological_level:

"When such price is reached by the specific security, commodity or a derivative, the tendency of the financial market participants (traders, market makers, brokers, investors, etc.) is to observe the number and act on their positions (either to buy, sell or hold)."

Fascinating, and a bit disturbing.