Tabell’s Market Letter – November 26, 1948

Technical Market Action The market has drif'ted lower- t'o again test the post election lows of 172.13 and 52.78. Whether or not these lows hold is problema- tical. In any event, both averages are very close to definite support levels at 171-167 and 53-50. Would continue to concentrate on the action of individual issues rather than the averages. Buying ranges on rails and airlines have been mentioned in previous letters. 'The oils are discussed below. While the oil stocks were fluctuating in a narrow range and building a'base pattern during late 1946 to early 1948, this letter continually stressed the strong technical position of numerous issues in the group. After the sharp advance in May-July 1948, profit taking was advised. The oils'have declined-'sharply'sThce-'t'lier9'48'high-swere reached and would appear to be again at or close to a buying spot. The table below shows the originally recommended purchase level, the upside objective outlined by the'base pattern formed from late 1946 to early 1948,and the 1948 high. . Recommended At Indicated 1948 High Barnsdall 21 Cities Service 28 Houston Oil 17 – 15 Pure Oil 24 Seaboard Oil 23 – 25 Standard Oil of N.J. 67 Texas Pacific Coal & Oil 15 on split basis 41 – 45 62 – 65 40 36 – 42 42 49 90 – 100 25 27 44 5/8 66 3/4 38 3/4 42 59 1/2 92 7/8 25 These issues built up distributional tops in the flurry of buying during May to July. In most instances, the downside indications outlined by these tops have been reached. The table below shows the downside indication, the low of the week of November 9th-15th, and Wednesday I,S' close. Houston Oil and Texas Pacific-Coal & Oilohave -been omitted as the technical pattern is not clear. Plymouth Oil, which reached a 1948 high of 70 3/4 and Shell Union Oil, which reached a 1948 high of' 46 3/4, have been substituted. Barnsdall Cities Service Plymouth Oil Pure Oil Seaboard Oil Shell Union Oil Stand.Oil of N.J. Downside Indication 37 – 33 44 38 38 – 36 30 – 28 37 – 35 37 33 72 – 70 November Low 35 1/4 39 5/8 36 1/2 28 7/8 36 3/4 35 1/4 72 Last -Sa-le 37 1/2 40 5/8 39 29 3/8 38 3/4 38 1/2 72 1/4 While some further backing and filling may be needed, these issues would appear to be in a buying range when near the indicated downside objectives. EDMUND W. TABELL '– … , —- SR;r;.ELDSCQM.PAJ\l4— u ., 1948 Closings Dow-Jones Industrials Dow-Jones Rails Dow-Jones 65-Stock 173.17 53.08 63.46 The opinions expressed in Ihls letter are Ihe personal inlerpretations 01 charts by Mr. Edmund W. label! and are not presented as the opinions 01 Shields & Company.