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Technical Market Action Glancing through the approximately fifteen hundred issues in my chart portfolio, one is immediately struck by the many diverse tech.icl patterns in individual issues. With the Dow-Jones industrial average holding in an extremely narrow trading range of less than 17 for almost twen montils, many individual issues hav advanced over 100. Most of the issues with sharp advances have been in the oil croup. J. few have been rails. On the other hand, niany issues in other groups are sellinl; lower tod.y than they were at the May lows of emost a year aGo despite a rise of more than twenty points in the averages. Seldom has there been a period when stock selection has been more important. IVhile the technical formations of individual issues have quite different patterns, they fall roughly into three categories. The first group includes issues that have spent a considerable time in a trading range building up a base pttern and have penetrated the base area on the upside to indicate an uptrend. Issues in this croup are at various stages of their development. Some are quite close to their uptrend objectives while others still have a considerable distpce to go. One common characteristic of this group is tilat they all are considerably above the 10Vis of the past twenty months. Many of them are above the 1946 hiGhs. The second group consists of those issues that reached their low points in he early part of the twenty-month trading range but are still in the process of forming a potential base pattern. They are selling below their FebruarY 1947 or July 1947 highs. The third croup consists of issues that have made tl'leir 10Vis only recently and have formed little or no base pattern. It would appear that considerably more time must be spent in a narrow trading ranGe before these issues are ready to move. It Vlould seem that the best buying opportunities at the moment ar in the second clasificction. These issues have already gone through the preliminary work of buildinc up a base pattern. While the timi.nr; of the start of their upswing is uncertain, it lVould appear that over the irttermediate term they could show considerable price enhancement. It must be remembered that the oil group spent a conSiderable period of time in backing and filling in a narrow,trading range building up a base. It ViaS during that time that the oils were recommended in'thiB letter. In fact, the oils were by far the largest section of our recommendid list. While some patience was required, the upslnnc in this group was substantial. Tne Greater part of the advance has occurred recently. Listed below are issues witil Similar potential base patterns to those of the oil group. In all cases, the potential upside indication is approximately double tile present price. In all cases, tile stocks are still in a narrow trading ran(;c and are not far away from the loVis of the last twenty months. In most instances, they are iesues of lesser known conpanies. Possibly that is one re.son, wi th the still low public market enthUSiasm, that they are behind the market. Purchases should be made, if possible, in the lower part of the trading range. Last Sale Alpha Portland Cement 28 3/4 Byers (ll.M.) Canada Dry 22 13 1/2 Carrier Corp 16 Ce10tex 27 3/4 Certain-teed 16 3/g Chic.Mil.St.P.Ser.A.pf 32 7/8 C\'1iCG.!;o North West 1 1/8 Consol.R.R.Cuba,pfd 23 1/4 Copperl'leld Steel 15 5/8 Eagle Picher Co 241/4 Eastern Air Lines 19 3/8 Eastern Stainless Steel 17 3/4 Fansteel Metal 14 3/8 Hewitt Robbins Corp 25 5/8 1946-19/.8 Range 39 7/8-25 35 1/-13 3/ 19 3/4-12 7/8 34-13 5/ 3 1/8-22i 25 7/S-13 1/8 82 3/4-30 43 1/2-14 3/4 47-161/2 2-1 30 1/8-19 33 3/8-16 1/8 61-163/4 42-10 5/8 391/2-21 Las 1946-1948 Sale Ran.fe Holland Furnace 27 5/S ll./S Inter.Tel & Tel 13 1/2 31 7/S-11t Masonite 61 1/2 75-47 1/2 Mesta Machine 42 6111-36 Minn.St.P.& SS 12 1/2 26 3/8-91/8 N.Y.Air Brake 39 1/2 -36 PacifiC Mills 38 lis 48-2 1/2 Pitts. Coke & C 13 l/Z 157/8- 'It Rheem Mfg 21 1/2 38-19 Schenley Dist. 2 5/ lOO-25t Spiegel,Inc. 12 3/ 39 7/8-77/8 Timken Detroit 21 27 3/8-l6JAj Victor Chern 40 1/2 53-36 1/4 Western PaCific 34 3/ 5-27 Zeni th RadiO 24 3/8 42 8-191/8 May 10, 194 EDMUND W. TABELL SHIELDS & COMPANY opinions expressed in fhll letter ero the personal Interpretation of charts by Mr. Edmund W. Tebel! and are not presented as the opinions of Shields &. CDmpany.