People are selling into the New Year to realize tax losses and close positions before the holiday

Here's what I think is behind this New Year's Eve slump:

1. Lots of people are tax-loss harvesting at the end of the year. People who bought near the ATH are selling now in order to realize the loss and offset other tax gains. It was a huge year in the stock market, and lots of people are realizing big gains this year, so any bit you can sell to counter it helps. In the U.S., there's still no wash rule, meaning you can just buy it right back immediately; however, I think a lot of people just go through their portfolio at the end of the year selling everything in the red and then worry about rebalancing in January
2. A lot of day-trader types want to check out for a long week and are closing their positions. Because who wants to worry about this kind of volatility over the long holiday weekend?

Just a theory, but those are my guesses at what's behind the latest slump—both of which would mean this is transitory and likely a great time to buy. What's everyone else think?