Stock Market Flirts with 22,000. Should You Care?
The Dow Jones Industrial Average (DJIA) is flirting with 22,000, and it may catch the attention of the media. It will likely get hyped as a big deal, and from where this bull market started back in 2009 coming out of the Financial Crisis, it is a great milestone.
However, it is not materially important as a long-term investor. Hitting 22,000 on the DJIA is simply a single point in time. It marks a point between where we started and where we are going. No meaningful financial decision should be made based on this number.
Recently, I published an article titled 3 Reasons You Should Stay Invested. This article continues to be sound advice today, and I suggest reading it if you have not done so already.
What might happen as a result of DJIA 22,000?
The market has used a good bit of energy this year to achieve this new high. I suspect the market may see a cooling off period. We are in the dog days of summer weather, and market history suggests it is one of the slowest times for the market too.
I believe the market may take a short breather. Think of it much like a long distance runner who will adjust their pace to build up energy for a strong push to the finish.
This bull market is not over yet, but it may require a rest before its next move higher. Long-term investors should stay invested and continue to give the current bull market the benefit of the doubt.
As we always say, when the market facts change, so shall we.
Right now, the facts continue to support the bull market, and that is what we plan to do.