Why prices stop at the same line

For 16 years, the Dow Jones, a group of 30 big US companies, kept stopping near 1,000. It got there, turned back, and came again.

Many people remember the same round number. Orders pile up near it, so each time the price gets there, it meets a wall of them. The line holds partly because people expect it to.

January 1966: the Dow touches 1,000 and falls back. 1972: again. 1976: again. Wall Street even named the fear: quadraphobia, the fear of four digits.

In December 1982 the Dow went through 1,000 and stayed above it. In January 1987 it passed 2,000. By October 1987, after one crash, it was back under 2,000. A line holds until it doesn’t.

Find a round number where a stock you follow turned back more than once. The line tells you where people waited. It can’t tell you when it breaks.

Prices stop at lines people remember. The Dow’s 1,000 held for 16 years, then it didn’t.