Over the years the $DJIA has taken a back seat the the $SPX. Young guns only think old geriatrics down in Boca with green visors look at it anymore. It’s thirty stocks, not five hundred, and some feel its not a “real” representation of the new market. Do we really care about $AA anymore? Who cares about mundane names like $PFE and $MRK when you can make face ripping gains in biotech stocks like $CELG or $BIIB? How about some $MSFT or $XOM? Get rich there lately? You can buy some $MMM if you love sticky notes, we really don’t manufacture anything anymore. You can 3D print Kate Upton now right?
The Dow 30 may be boring, but they do matter as a benchmark. Many have international exposure, so it tells a story and paints a picture.
The problem with the $DJIA right now is that it is fading and it will need to rally soon or the other indices run the risk of following it lower. Hard to say here if its the tail wagging the dog here as the $SPX $IWM and $QQQ are trying to turn up, the DOW is not.
I think any rally in the Dow will be accused of doing nothing more than forming a right shoulder to a potential bearish head and shoulder pattern anyway. At least that’s what the bears will saber rattle about. I can’t think that far in advance, but its fun to talk about. One day at a time.
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