Friday, January 6, 2017

Tonight we're gonna party like its 19,999

In several massive attempts on Jan. 6 to breach the uncharted 20,000 level on the Dow, inter-day trading came up the tiniest fraction short as the equity market touched 19,999.63, then sold off after eight solid attempts to breach the psychological barrier.


Many analysts had expected the Dow to have breached 20,000 before the start of 2017, but the 'Santa Claus Rally' never emerged and the market closed out the year at 19,762.

Image result for dow 20,000

With the combination of geo-political and economic events causing currencies, bonds, and even bank solvency to be in question here in the first week of the new year, it is difficult to predict exactly when the Dow may reach and break through the 20K barrier of resistance.  But whether we see that level broken early Monday morning, or on some random day in the coming week, the reality is that nearly all stocks are vastly overvalued, meaning when the correction comes it will be much greater in scope than the nearly 20% decline that took place this same time last year.

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