The bulls didn't have enough juice in the early going to make the run to 20,000 of the Dow Jones Industrial Average, but they are regrouping and will give it another go. Yes, it is an irrelevant level in a misleading index -- and is receiving way too much coverage -- but in the field of behavioral economics, this target falls within the definition of heuristics.
According to Wikipedia, heuristics "are simple, efficient rules which people often use to form judgments and make decisions. They are mental shortcuts that usually involve focusing on one aspect of a complex problem and ignoring others."
The 20,000 level is a mental shortcut for the market. Since everyone is focused on it, then the simple and efficient thing to do is plan on it occurring. There is no complicated science or math here. That 20,000 is psychologically obvious to everyone, therefore it will happen sooner rather than later.
While we wait for the inevitable event to occur, the best use of our time is to keep on digging for some trades. The steel names I mentioned in my prior post are chugging along at day high, and I'm inclined to add to my position in AK Steel (AKS) .
Big-cap technology are the primary leaders today, with previous stock of the week, NVIDIA (NVDA) being one of the main leaders. Growth Seeker holding Amazon (AMZN) and Tesla (TSLA) are also helping the cause. Goldman Sachs (GS) is hitting new closing high levels and is helping the DJIA again.
I've taken some partial profits in Impinj (PI) , but this one looks like it is in play and I anticipate it will be on the screens of momentum players for a while.
While I believe it is very likely that we will breach this 20,000 level very soon, I'm not that confident that we will end the year over that level. Once that level is broken, it should spur a little additional buying, but we often see some surprise profit taking in the last few days of the year. Many folks are happy to close things out, regardless of taxes, and start the new year with plenty of cash.
This 20,000 is easy and obvious, but what comes after that will be the hard part.
