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At one point this morning we looked up and saw the Dow up 130 points, but in percentage terms, the index was up just two-thirds of a percent. With the Dow currently trading at 19,440, a triple-digit move just barely cracks a move of half a percent. And if the Dow gets up to 20,000, obviously that means a 100-point gain translates into a move of exactly half a percent. Yep, 100-point moves just aren’t what they once were. “Back in the good ‘ole days, a 100-point move meant something.”
Below is a chart that shows the impact of a 100-point Dow move in percentage terms based on where the index is trading in price. This is obviously common-sense stuff, but we thought it was worth posting given that the index is quickly approaching the 20,000 mark. From a psychological perspective, a 100+ point Dow move still seems like a big gain or decline in the minds of most investors, but the reality is that at these levels, the index needs to move 200+ points to be categorized as a “big move.” Over time the psychological adjustment will be made, but for now it’s likely that investors are viewing daily Dow point moves as more impactful than they really are.