Finally, technical analysis wouldn’t work if market movers wouldn’t have computers placing trades at such arbitrary milestones as Dow 10000. After all, today the Dow 10100 became a fierce resistance line. Thousands of traders cannot make a market as predictable as this, only pre-programmed trading can, IMO.

Just as 14,000 means nothing in itself, neither does 10,000 – just an easy way to note another milestone so to speak. It goes without saying, of course, that the number or any Dow number has nothing to do with the actual underlying economy. Media analysts who slip that assumption in are wrong.

Indeed, certain round numbers mean absolutely nothing from a purely financial perspective. However, the Dow reflects trade and trade is made by people, who are not merely driven by numbers. You have to acknowledge that some round numbers, whether in stocks, market indexes, cars ($19995), trinkets ($0.95), gas ($1.509), etc, do play with emotions.

True enough, it’s amazing to see the market pussyfooting around round numbers, when they sometimes are resistance points or support points at other times. In this case, the market has been resisting going beyond Dow 10000, often tracing back from it. Eventually, when it broke it, it did it with some gusto, as we’re seeing.

So, I’d say that from an investment perspective, it does signal how optimistic or not the market is whether a milestone is broken or resisted. True enough, not that it should affect one’s long term strategy, but if one happens to be rebalancing his portfolio while the market is courting a milestone, one may wait a few days to see how to bias his rebalancing.

HTH