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Dow Peers Above the 10,000 level, Retreats 
DJIA.AThursday, June 10, 2010
By Gibbons Burke
The Dow Jones Industrial Average (DJIA.A) traded up to and beyond the 10,000 level on Wednesday, getting as high as 10,065.14, but then beat a hasty retreat back below that level by the close at 9,899.25. The average was down 0.4% on the day and has lost -3.4% over the last five trading days. Tuesday the average traded down to a 13-week low.
The 10,000 level is a big fat round number which people like to focus on and so it is not surprising to find that there are some consistent patterns of movement associated around the market's crossing that price.
Q: How has the Dow performed in its history when the intra-day high of the average has crossed above the 10,000 level (compared to the previous day's high)?
A: According to the 12 previous occurrences of this event, EventEdge indicates that DJIA.a has shown a somewhat bullish edge that peaks 19 trading days after the event. Thus, the projected date for the peak of the bullish edge relative to the current event date (Wednesday, 9 June 2010) is Tuesday, 6 July 2010. DJIA.a rallies in 92% of the cases (11 of 12) by an average of 4.5% relative to the close on the event date. The average of the 1 decline is -6.6%. The overall return of the 12 cases is 3.5%, which, based on the close of DJIA.a on the event date (9899.25), provides a target price of 10245.72.
We have featured this event on several prior occasions, listed in the related ideas below.
Gibbons Burke2 is editor of MarketHistory.com.
Related Ideas:
- Dow 10,000 - What's the Significance?3 - October 15, 2009
- Dow - Up Periscope!4 - October 20, 2004
- Dow and 10,0005 - August 18, 2004
- Dow at 10,000 - Once More Into the Breach6 - December 9, 2003
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Let variable values:
@ = DJIA_ACT
theEvent = IF
High of DJIA_ACT crosses above 10000
THEN 1
ENDIF
Date Day t+1 t+5 t+10 t+15 t+19
03/16/1999 Tue -0.5 -2.6 -0.2 0.3 4.1
03/09/2000 Thu -0.8 6.2 11.1 9.7 10.2
03/20/2001 Tue -2.4 2.3 -2.4 3.9 4.5
12/05/2001 Wed -0.1 -2.2 -0.4 0.2 0.6
02/14/2002 Thu -1.0 -0.3 3.7 5.7 5.2
04/30/2002 Tue 1.1 -1.1 3.5 1.6 1.6
05/31/2002 Fri -2.2 -3.4 -4.5 -6.8 -6.6
12/09/2003 Tue -0.0 2.1 4.2 5.3 6.1
05/19/2004 Wed -0.0 1.7 2.6 4.8 4.4
08/17/2004 Tue 1.1 1.3 2.0 3.4 3.5
10/19/2004 Tue -0.1 -0.1 1.4 4.9 6.6
10/14/2009 Wed 0.5 -0.7 -2.5 -2.1 2.3
06/09/2010 Wed NaN NaN NaN NaN NaN
Avg -0.4 0.3 1.5 2.6 3.5
AvgPos 0.9 2.7 4.1 4.0 4.5
AvgNeg -0.8 -1.5 -2.0 -4.4 -6.6
PctPos 25.0 41.7 58.3 83.3 91.7
PctNeg 75.0 58.3 41.7 16.7 8.3
Maximum 1.1 6.2 11.1 9.7 10.2
Minimum -2.4 -3.4 -4.5 -6.8 -6.6
StdDev 1.1 2.6 4.1 4.3 4.1
ZStat -0.3 0.1 0.4 0.6 0.9
Variance 1.2 7.0 16.7 18.4 16.6
13 Occurrences |
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2 http://www.markethistory.com/staff/detail.html?s=gibbons
3 http://www.markethistory.com/subscribe/best_of/content.html/16345.html
4 http://www.markethistory.com/content/content.html/7350.html
5 http://www.markethistory.com/content/content.html/7156.html
6 http://www.markethistory.com/content/content.html/6308.html