Tabell’s Market Letter – October 07, 1946

Technical Market Action market continues to back and fill and gives the appearance of building up a area between the recent high of 175.45 and the September low of 164.08. These two figures are the important points to watch for the moment. Abili ty to rally above the 175.45 level woul.d indicate an intermediate uptrend in the primary bear market. A reaction below the 164.08 level would indicate a continuation of the downtrend to the Last week ..e mentioned the technical pattern of American Rolling Mills and its possible base pattern. The confirmation of the base and the indication of an uptrend would be a sale at 36. Listed belon are a number of issues with formations somewhat similar to that of American Rolling Mills, together with their favorable pen8tration point and their recent low. All of these issues suggest possible accumulation – AAllegheny Ludlum Allied Stores Allis Chalmers American Foreign Pro 2nd pfd. Anaconda Copper Bliss (E.W.) Crane & Company Jones & Laughlin Locr.heed Mead Corporation National Distillers Rayonier Republic Steel Revere Copper Reynolds Metals Union Bag U. S. Rubber u. S. Steel Recent Low 38 36 36 5/8 19 35 1/8 181/2 33 1/2 33 1/4 26 1/2 18 3/8 21 1/2 171/4 25 18 24 1/2 23 51 5/8 66 Favorable At 45 42 42 24 40 23 39 40 33 22 26 21 30 23 31 30 62 73 Last Sale 42 1/2 39 1/8 37 21 1/4 37 1/4 201/2 35 1/2 35 3/4 28 1/4 22 1/4 231/2 18 26 1/2 19 3/4 26 1/4 27 1/4 571/4 68 3/4 A very small group of issues have already penetrated favorable upside levels, but the number is so small that there is the possibility of a false signal, Prominent in this select group is Bethlehem Steel which penetrated upside resistance at 96. Its base pattern suggests a rally to the 109-111 area. EDMUND Fl. TABELL october 7, 1946 SHIELDS & COMPANY Closing Dow-Jones Industrials DOIJ-Jones Rails Dow-Jones 65-Stock 168.87 46.65 60.71 The opinions expressed in thiS letter are the perlonal interpretation of cherh by Mr. Edmund W. iebell end are not presented liS the opinions of Shield. & Company