———— Technical Market Action The adjournment of Congress failed to rouse the market from 12iits lethargy. On volume of only 670,000 shares, prices drifted lower on Monday with the industrials down on the day at 182.26 and the rails off at 60.45. The intra-day lows were 182.02 and 60.40. The market appears headed for another testing of the July 19th lows of 179.58 and 58.39. The market successfully met the first testing of these lows on July 30th when the decline halted at 180.04 and 59.52. If the averages are able to hold above the July 19th lows, the market will have formed a triple bottom, which usually is a strong technical pattern. The following comment on the Dow-Jones averages which appeared in the Dow Analysts column in the August 9th issue of Barron's seems rather appropriate at the moment. Subject to confirmation or denial by future market events, the Dow-Jones industrial and railroad averages last week presented very faithfully the picture of what the late Robert Rhea ued to call a 'buying spot'. The lateidentification of the major trend under the Dow method showed it to have been up, A secondary down- trend has been under way, but there has been a minor rally followed by a small decline stopping short of the recent lows. Latest development is 'indecisive movements near those lows,with extremely dull trading. These all are the characteristics which Rhea ascribed to his 'buying spots', n If the averages hold above the July 19th lows and then penetrate the recent highs of 187.00 and 62,14, the secondary trend will be reversed. In that event, the upside potential would be the 200-210 level. In fact, ability to penetrate the August 5th highs of 184.54 and 62.14 would be a pretty good indication that the 187,00 upside breakout would occur shortly. If the averages break the July 19th lows on the downside, a continuation of the secondary downtrend to a full two-thirds retracement of the February-May rise would (be the maximum expectation on the downside. This would mean about 175 on the industrials and 55-54 on the rails. Both of these pOints are strong support levels. As mentioned before, my downside objective on the industrials does not indicate a decline as low as 175. My objective has been the 182-178 area, The rail average has an undecipherable top pattern. However, the three combined averages indicate the possibility of slightly lower levels. For example, the New York Times average which reached a low of approxi- mately n8 on July 19th, indicates a p'ossible n6-ll4, the New York Herald-Tribune average,which reached a low of approximately 123, indi- cates a possible 121 and the Dow Jones 65-Stock average, which reached a low of approximately 67i, indicates a possible 65-64, These are the maximum objectives I canenvision on the downside. I believe the market, in the 180-184 area, is in a buying spot. If the averages break down below the July 19th lows, they may go moderately lower, say about four to seven pOints on the industrials, from present prires. The upside potential appears to be about 18 to 28 points higher. On that basiS, the market appears to me to be a pur- chase. I am adding three new issues to my recommended list. They are Interchemical Corp. (19 3/8) and Pittsburgh Plate Glass (35) in the medium grade group, and Raytheon (7 1/4) in the speculative. The complete list of recommended issues mentioned in my last letter will be ready for mailing shortly. EDMUND W; TABELL August 9, 1948 SHIELDS & COMPANY 1M opinloM expr,ued in this lett.r ar. the personal Interpretations of cham by Mr. Edmund W. label! and are not presented 81 the opinions of, Shields &; Con,pany,

Technical Market. Action The market continued the downtrend for the first three hours of Wednesday's session. All averages penetrated the lows of July 19th. The industrials reached an intra-day low of 177.40 as compared with the July 19th low of 179.58. The rail low was 58.24 as against 58.39 and the low on the 65-Combined Stock average was 66.26 as against 66.90 on July 19th. The market rallied in the final two hours of trading and the averages regained a good portion of the day's losses. At the close, the industrials, at 179.27, were off 75 cents, the rails at 59.06 were down 62 cents and the Combined average at 66.99 was off 41 cents. Volume for the day totalled 1,310.000 shares with 820,000 shares on the first three hours of reaction and 490,000 on the last two hours of advance. It is my belief that the market is in an important buying zone. I was wrong in supposing in July that 185 would be a strong downside resistance point and, in the-event of a penetration of the 185 level, 180 would be the ultimate low. Resistance was met at 180 on the two occaSions, but Wednesday's market dipped below it. Nevertheless, I believe the dip is temporary. The averages and industrial stocks have not built up large distributional areas. The clearest patterns are' on the combined averages. The lowest down count on the 65-Stock average is 65-64, on the New York Times average 116-114 and New York Herald-Tribune 121. These objectives were almost reached at Wednesday's lows. Subject to some further minor adjustments, the market appears to b at an important buying point. In contrast to the possibility of slightly lower levels, the technical indicator mentioned in previous letters gave a buy signal at the close. This indicator signalled tne turning point on the bottom on July 19th and July 30th. From the low pOints of those days, the industrials rallied seven pOints and four points. The fact that this indicator has reached an oversold point on three occasions in less than a month indicates a well liquidated market. Volume indications on each of the three declines are favorable. The July 19th volume was 2,600,000 shares, the July 30th volume was 1,340,000 and Wednesday's volume was 1,310,000 shares. Subject to some further irregularity, believe the market is at an important buying point with substantially higher levels indicated for the longer term. At the moment, like the rails and steels. August 11, 1948 EDMUND W. ,TABELL .SHIElJ)S & COMPANY 2f IJ1 IS\j -0–…0. Th. opinions expressed in this letter are the personal interpr.tation of e.b.rh by Mr. Edmund W. Tab.1I end art not presented .!II the opinions of Shields & ComplnY.

–a- Technical Market Action The market quieted down again on Wednesday after the previous day's upswing. At the close, both averages showed fractional losses on the day. Volume continued small with a turnover of only 640,000 shares. It is interesting to note that the technical indicator mentioned in past letters has been quite accurate in catching the turning pOints after the market became oversold. It gave a buying signal on July 19th, July 30th and again on August 11th. Fairly good short term moves resulted after these buying signals as noted below. Low Date Rally High Date Points Advance 179.58 July 19th 187.00 180.04 July 30th 184.54 177.40 Aug. 11th 183.21 July 28th Aug. 5th Aug. 18th 7.42 4.00 5.81 I continue to believe that the market is definitely pOinted higher for the longer term. I believe that the recent decline from the June-July tops is a secondary decline in the primary uptrend. It presents a buying opportunity to those who did not enter the market in our oft-repeated 160-170 buying zone during the October 1946-March 1948 period of accumulation. I believe the primary uptrend will be resumed shortly. When it will start and whether it will be necessary to again test the 177-175 support level is not yet quite clear. I had hoped that the lows had been reached on each of three buying signals mentioned above. However, on the first two occasions, after a brief rally, the market resumed its secondary downtrend. This third occasion may be different. It is a little too early to be sure but there are a few technical considerations, beside the oversold buying signal given on August 11th, that indicate the probability of an important turn. One is the fact that the downtrend line connecting the successive highs since the July 9th top has been broken. This also has occurred on the New York Herald-Tribune and N. Y. Times average. Another favorable indication was the small upside gap on the average on Tuesday morn- ing with an intra-day high of 180.62 on Monday and an intra-day low of 180.75 on Tuesday. This, combined with the downside gap between 179.88 and 179.81 formed on August 11th, leaves the trading between August 11th and August 16th in a little island by itself, detached from the main pattern. While the gaps in this case are small, they indicate the possibili-ty of what is technically known as island reversal, This type of formation has quite often indicated an im- portant reversal in trend. Also, volume indications are favorable with successively smaller volume at each of the low points mentioned in the table above. r believe that the ability to penetrate the August 5th highs of 184.54 and 62.14 would be a pretty definite indication of an im- portant upturn. EDMUND W. TABELL August 18, 1948 SHIELDS & COMPANY Closings Dow-Jones Industrials Dow-Jones Rails Dow-Jones 65-Stock 182.12 59.37 67.81 The opinions expressed In Ihls ieHer are the personal interpretations of charts by Mr. Edmund W. Tabell and are not presented IS the opinions of Shields & Company.

Technical Market Action The market was reactionary on Monday and the averages finished near the lows of the day. The industrial average lost 1.85 to close at 181.75 and the rails were 62 cents lower at 60.10. The one encouraging factor was the lack of volume on the decline. Transactions f the day totalled only 630,000 shares for the entire day. This was in direct contrast with the upswing in the last hour of Friday's session when the transactions for the hour totalled 260,000 shares or a daily volume rate of 1,300,000 shares. It seems appropriate at this time to repeat a wire sent out to branch offices or correspondents on last Friday noon. From the way the market is shaping up, I expect, from a timing viewpoint, that the broad advance from the July 19th-August 11th lows should start not later than the middle of next week. I believe such an advance could be of eight to ten weeks duration. There is outside possibility of one more dip so would buy either on any dips into earlJ next week or on penetration of August 5th highs of 184.54 and 62.14. I see no indication of a bear market for many months to come. Reprinted below are comments on some of the issues in my recommended list. The excerpts are from recent issues of Facts and Forecasts published by Standard & Poor's. The ending in heavy type, in parenthesis,is my own technical opinion. Byers (A.M.' The long-term trend of demand for wrought iron products has been downward for years, with this material continuing to lose ground in competition with cheaper steel products. However, as a recent beneficiary of steel shortage, expectations are that earnings in the fiscal year to end September 30, 1948, may range around 6 a share. With no slackening in demand for its pipe and other output, a similarly high level of profits is probable in the 1948-49 year. But, in view of the company's marginal status, the stock market is unlikely to capitalize these boom-time earnings very generously, particularly since divi dends will remain convervative. The stock is in no better than an average market position. (I DO NOT AGREE WITH THIS CONCLUSION. THE STOCK HAS AN EXCELLENT PATTERN AND AT PRESENT LEVELS AROUND 23 IS IN GOOD SUPPORT AREA. ADVISE PURCHASE.) Carrier Corp. A recheck of this situation indicates that new orders have turned up sharply, and therefore the rating is reinstated at Above Average. (THIS STOCK HAS FORMED A LONG POTENTIAL BASE PATTERN IN THE 13-21 AREA. IT APPEARS TO BE AN INTERESTING SPECULATION AT ITS PRESENT PRICE OF 15 WHICH IS NEAR THE LOW OF LAST TWO YEARS.) Commercial Solvents.common usually sells at a fairly high price earnings ratio. Product diversification is relieving the dependence upon solvents and partial substitution of natural gas as the raw material will lower costs. Increasing efficiency of the new plants should offset the uptrend in costs, but lower alcohol prwes may narrow margins. However, results in the final half probably will improve from the depressed second quarter level, but net for all of 1948 maI fall below the 3.44 a share of 1947. No immediate change in the 372-cent quarterly dividend rate is looked for. (THE STOCK HAS HAD A SHARP RE- ACTION FROM ITS 1948 HIGH OF 29 3/8. AT AROUND 22, IT APPEARS TO BE UNDERVALUED TECHNICALLY.) Elliott Company, Unfilled orders were around 30,000,000 at the end of July. Paced by early year gains, and aided by expanded facilities, an abrupt rise in 1948 shipments is in prospect. Thus, re- sults for 1948 are expected to increase sharply from the 3.99 a share of 1947. Capital needs for expansion suggest a conservative dividend policy. The stock has a good measure of attraction. (THE TECHNICAL PATTERN ON THIS ISSUE SUGGESTS SUBSTANTIALLY HIGHER PRICE LEVELS. IT IS NOW JUST ABOVE THE STRONG 23-21 SUPPORT LEVEL.) There are still a few copies available of the revised recommended list.of August 11th. They will be sent only on written request.' EDMUND W. TABELL August 23, 1948 SHIELDS & COMPANY The opinions expressed in Ihb letter are the personal Interpretations 01 charts by Mr. Edmund W. labell and are not presented as the opinions 01 Shields & Company. —

Technical Market Action Volume dried up again on Wednesday with a turnover of only 520,000 shares for the entire day. The rails, due mainly to a rise of almost three points in Santa Fe, closed 10 cents higher at 61.00. At the day's high of 61.50, the rails were within shooting distance of the August 5th high of 62.14. The industrials showed a fractional loss of 17 cents at 182.41. The market continues to appear oversold and on the verge of an upside breakout. Ability to cross the August 5th highs of 184.54 and 62.14 would be of considerable bullish significance. Continued below are comments from recent issues of Standard & Poor's Facts & Forecasts on issues in my recommended list. The comments in parentheses in heavy type are my own technical opinions. E.WoBLISS COMPANY common is highly speculative, with sales and earnings subject to sudden shifts. However, with the outlook fa- voring a turn in the trend of new business before long, the management aggressive and current prices for the split stock making allowance for lower profits, the shares have appreciation possibilities. The dropping off in orders for new presses is attributed mainly to the steel short- age, which discourages expansion, and to resistance of customers t- accepting a price liability at the time of shipment, since the inter- vening period may be fairly long as the company's order backlog still is large. It is believed that the trend of bookings will improve as the steel supply situation gets better, and the backlog is reduced. (THIS ISSUE HAS BUILT UP A TECHNICAL PATTERN THAT SUGGESTS AN ABOVE- AVERAGE PRICE RISE. NOW AROUND 14.) . HUDSON MOTOR CAR. Hudson's plants have been shut down because of, a supplier strike 0 However, once this is settled, production of ad- vanced models should recover sharply. Moreover, barring the imposition of serious government restrictions on steel use,further gains are like- ly when the leased sheet steel mill gets into large-scale operation and permits eased supplies. On this basis, and with facilities expanded and prices advanced, a good gain in 1948 sales, probably to an all-time peak, is indicated. The 11 price markup effected when,new models were introduced was followed by a further rise 'in late June to offset higher costs. Thus, despite large amortization charges, satisfactory margins and a sharp gain in profits to between 4.50 and 5 a share are indicated for 1948. While large capital needs will dictate a conservative policy, an increase in the 10-cent quarterly dividend or further extras are likely. (AT AROUND PRESENT IEVELS, HUDSON APPEARS TO BE AN EXCET.ToENT SPECULATIONi THERE IS NO HEAVY OVERHEAD RESISTANCE UNTIL THE 26-28 AREA.) JOY MANUFACTURING. Mining industry replacement and expansion needs, accelerated by high labor costs, are substantial, indicating good earnings over the next few years. Moreover, because mechanization of mining is relatively new, growth prospects are promising while competition from used equipment is no factor. As of May 1, 194, unfilled orders for coal mining machinery represented from ten to twelve months' production of the companyls plants. A continuous coal mining machine and hard rock mining unit has been introduced. Moderately higher profits are indicated for the fiscal year ending September 30, 1948, but the larger number of shares outstanding probably will reduce share net to 7.-7.50. With the outlook promising for 1948-1949 and beyond, dividends should remain at the 60 cent quarterly rate, at least. (JOY APPEARS TO BE IN A SLOW BUT DEFINITE UPTREND. PURCHASE IS ADVISED IN 35-36 AREA.) KOPPERS CO. Within another decade company is likely to derive the bulk of its profits from chemical activities.At least the shape of growth and capital expenditures is following these lines. This is not to say that the management is giving up its primary position in coke oven construction, steel plant engineering, coke and gas,wood-preserving foundry ppoducts and special machine work, to mention the major products but the principal post-war accent has been on growth of the various aspects of coal-tar derivatives.The point of Koppers becoming more and more identified with the chemical industry is that fairly wide price- earnings ratios are the rule rather than the exception for this group of equities.Thus,on estimated 6 a share earnings this year,the issue has a good measure of appeal. (FROM A TECHNICAL VIEWPOINT,STOCK APPEARS TO BE IN A GRADUAL BUT DEFINITE UPTREND. PRESENT PRICE APPROXIMATELY 33-34.) August 25, 1948 EDMUND W. TABELL SHIELDS & COMPANY The opinions expressed In this letter are Ihe personal Interpretations of charts by Mr. Edmund W. Tabell and are not presented as the opinions of Shields Company. –

Technical Market Action After a firm opening on Monday with the rails topping the important August high of 62.14 to reach 62.2land the industrlaIs, at 183.95 nearing the August high of 184.54, the market aold off in the final hours of trading. The reason, presumatly, was the postpone- of the issuance of a communique on the four-power conference at Moscow. The industrial average closed off 1.12 at 182.09. The rails, however, lost only lOt to close at 61.34. The action of the rails is very important. As mentioned before the rails have been the forerunners of the market ever since 1942. They led every advance from May 1942 to early 1946 when their worse than market action was a warning of the September 1946 break. Since the early part of this year, the rails again assumed their market leadership. In my opinion, the better than average action of the rails' indicates a near term upside breakout from the narrow trading of the last few weeks. Reprinted below is a write-up on Cooper Bessemer Corporation from Shields & Company's Research DiviSion Comment of August 6th. The comment in heavy type and in parentheses is my technical interpretation of the chart pattern – Extending the upward trend which began two years ago,Cooper Bessemer established new peacetime highs in sales and earnings in the first half of 1948. Billings of 17,491,000 were up 34 from the year before, and earnings of 5.03 a share on the common showed a year-toyear increase of 52. Reflecting the improvement, the dividend rate on the common recently was raised from 0.25 a share quarterly to 0.50. Prospects for this prominent maker of diesel engines and gas and air compressors remain quite promising. The unfilled order backlog, placed around 19,500,000 in late July, was down slightly from the April figure but still was larger than at the close of 1947. New business continues to develop at a very satisfactory rate and, given adequate supplies of materials and parts, the company should be able to maintain its record level of billings for some time ahead. The trade reception of several newly designed products continues to be gratifying. The extensive improvements in plant eqUipment and in product list have materially strengthened the company's position as compared with pre-war years. The gain is perhaps best illustrated by the fact that the operating profit margin currently has been widened to around 15 of the sales dollar, compared with an average of well below 10 in pre-war years. Helped by the sizable earnings of the last eighteen months, the balance sheet also shows material improvement. On June 30, working capital exceeded 10,000,000 and was more than double the figure at the end of 1939, even in the face of heavy capital expendi- tures since the end of the war. Selling around three times the current annual earnings rate, to yield over 6.5 from the recently increased regular dividend, the common is regarded as one of the more reasonably priced equities in the industrial machinery group. (THIS ISSUE HAS A VERY ATTRACTIVE TECHNICAL PATTERN AND IS HEREWITH ADDED TO MY RECOMMENDED LIST OF ISSUES WITH OUTSTANDING TECHNICAL PATTERNS. THE STOCK APPEARS TO BE IN A GRADUAL BUT DEFINITE UPTREND WITH AN ULTIMATE UPSIDE OBJECTIVE CONSIDERABLY ABOVE THE PRESENT 29-30 LEVEL.) ATLAS PLYWOOD – Demand for plywood packing casings has slack- ened, partially due to the interruption in production of consumer durable goods caused by steel shortage from the coal strike and par- tially because of reduced shipments of such lines as radios and washing machines. Moreover, sales to the textile industry are down, while the demand for produce crates and baskets is no longer urgent. The company has a dominant position in the trade, is well integrated and capably managed. Moreover, present prices for the stock are low in relation to current earnings and dividends. Nevertheless,price appreciation from current levels is likely to be restricted, because of the downtrend in operations and the long-term threat of increasing competition from im- proved paperboard shipping containers. (THIS STOCK HAS A VERY INTEREST- ING PATTERN. AS LONG AS IT HOLDS ABOVE THE 25-24 SUPPORT LEVEL, IT HAS THE POSSIBILITIES OF A POTENTIAL UPMOVE OF CONSIDERABLE IMPORTANCE. AT ITS PRESENT LEVEL OF 27, IT APPEARS TO BE A GOOD SPECULATION.) The above is from Standard & Poor's. August 30, 1948 EDMUND W. TABELL SHIELDS & COMPANY The opinions expressed in this IeUer are tne persona' In'orpretallons 01 chBrts by Mr. fdmund W. rabel! and are not presented as Ihe opinions of Shields & Company.

— —- Technical Market Action The market strength of Wednesday and Thursday carried the rail average past the August high of 62.14. Thursday's high was 63.36. The industrial average,at Thursday's high of 184.88, fractionally pene- trated ,the August high of 184.54. A bit more decisive penetration by the industrials, say to above 184 on an hourly average or at the close, would confirm the uptrend signal given by the rails. From the action of the rail average, it would seem that the advance mentioned in earlier letters has started eve though it is about a week late. I expect the advance will be a broad upward move of two to four months duration with a price objective somewhere around the 1946, high of 213. First resist- ance should be met at the 188-190 level followed bY,a dip back to 185 or so before 188-193' supply area is penetrated. ' In recent weeks there has been a decided 'increase in bearish prognostications regarding a slump in business' and a, depression. These predictions by economists, newspaper columnists and Washington writers, are not new. They started in the Autumn 'of 1945 when President Tru- man's advisory board warned of, a coming drop in the business index that would result in seven or eight million unemployed by early 1946. As a result, the President attempted the obviously impossible procedure of trying to raise wages while holding down prices., No prediction could have been more wrong. The ensuing predictions have been equally falla- cious. The predicted slumps in business in late 1946 and early 1947 and early 1948 have not occurred. Now the recession has been postponed to late 1949. As a result of these dire propheSies, the investing and speculating public has become so fearful of the coming catastrophe that stocks are selling at an absurdly low price to earnings ratio to yield, in innumerable cases, 5 while high grade bond yields are still hovering around the 3 level. I do not pretend to be an economist. I don't know when business will start to falloff sharply. Obviously, our tremendous business boom cannot last forever. However, the inevitable ending is not necessarily a bust. It is possible that there will 'be piecemeal adjustments as each sector of industry, one by one, readjusts and returns to a normal pattern. This has already happened in many industries. Certainly, the, shortages and demands built up by four years of war and by ten years of depression are hot going to be satisfied by the last three years of peak production, large as that production may be. This becomes even more unlikely when we consider the growth in population over the last twenty years, and the greatly increased incomes of a vast segment of our people, thus greatly enlarging the mass buying power. If the stock market had only partially discounted the vast business boom of the last three years, there might be some cause for concern about a drastic slump in the market, but even a temporary falling off in business should not, ,effect, to any great extent, a market that has no top-heavy speculative pOSitions, is not operating on borrowed money, ,and has not risen in price to discount ,the greatly increased earnings;f ,' The stock market sceptics of today are possibly forgetting the psychological state of mind of the nation. This certainly has been true for the past two years when, despite the huge earnings and dividends, a mass fear psychosis has held back the stock market despite price rises in everything else. A l!Iood of pessimism or of 'optimism The opinions .xpressed in this leHer are- the perianal interpretation of ch,uts by t..1r. Edmund W. Tabel! end are not prese,nted as the opinions of Shields & Company. ——————————————————————————– Technical,Market Action -2- however, cannot be sustained over a long period of time. Nothing changes faster than public sentiment, and, after two years of fearful forebodings of dip in business, the mass psychology is about ripe for change despite even a possible temporary 33 1/3 to 50 drop in earnings. Mass thinking cannot be measuredby statistics or fundamentals. It can only be measured by the technical action'of the market itself, by the demand for and supply of securities. The stock market has been slowly building up a strong pattern for a number of years. With the many uncertainties of te present day, it is a hazardous task'to attempt a long range forecast. The predictions of today'may look awfully bad two years from now. However, while this letter may have many faults it is always willing to state a definite opinion. Based purely on the action of some fifteen hundred charts'and graphs of the variOUS market averages and individual stOCks, I submit the following long range prediction. The price ranges are definite but the timing is only approximate and largely guesswork. I believe that the stock market in May 1942 started a long upward war price cycle, similar to that 'of 1914-1929. Such long term price cycles usually have five phases – three of advance and two of decline. The first phase was the advance from 93 in the Dow-Jones industrials in May 1942 to 213 in May 1946. The second, or declining phase, was the drop from 213 to 160 in May, 1947. 'This area was again tested in February of this year. We are now in the third phase -,a period of advance. The recent decline was only a normal intermediate correction in the major upmove. This third, or aqvancing phase, will be comparatively moderate and selective with the better-grade, wellmanaged companies leading the advance. The ultimate objective, interrupted by intermediate corrections, will be around 250 in the Dow-Jones industrials with 5 leeway on either side. This objective should be reached in late 1949. The fourth Or declining phase should culminate in the early 1950s in the 200-180 area. The fifth, or final advancing phase will be an upsurge carrying into the middle 1950s. This will be the dynamic upswing with over-speculation and heavy public participation. The pattern is not complete as regards the ultimate price object- ive for this final advancing phase, but the Dow-Jones industrials should sell above the 1929 high of 386 A preliminary objective, cal- culated from the long term base patterns, suggsts about 450 in the averages. The objectives of 250 for the present phase, and 450 for the ultimate advance, seem fantastic now, but only because of the present depressed mental state. Percentagewise, the advances are quite in line with the moves of the market over the past sixty years. It must be remembered that this country is still in a long term upward growth channel My prediction may eventually turn out to be quite conservative. September 2, 1948 EDMUND W. TABELL SHIELDS & COMPANY Dow-Jones Ind. 184.41 Dow-Jones Rails 62.90 Dow-Jones 65-Stock 69.56 The op;'ios expressed i this leiter are Ihe penon&J lnlerprefatioft 01 charts by Mr. Edmund W. Tabell and ere not presented as tho opinions of Shields & Company.

Technical Market Action -' The industrials decisively penetrated the August high on Tuesday and confirmed the uptrend signal given by the rail average last week. Tuesdays highs were 185.64 and 63.25 as compared with 184.54 and 62.14 on August 5th. This indicates that the secondary correction of the February-June advance from 164 to 194 has been completed and the next,step is a testing of the 1948 highs of 194.49 and 65.23. If both averages succeed in reaching new high territory, the major uptrend, which is now in effect, will be confirmed. Failure to penetrate the 1948 highs by both averages, followed by a downside penetration of the August lows of 177.40 and 58.25 wouId indicate a bear market. It is the opinion of this writer that the major uptrend will be confirmed and that we are now in a broad upswing of two, to four months duration. The advance should reach the 205-215 level in the industrial average'- While the rails pOint higher, it is difficult to figure the exact objective except in individual issues. First resistance to the advance will be met'at the 188-190 level. After a minor technical correction, would expect a penetration of the 1948 highs. As for groups, believe the rails, steels, automobiles nd machinery equipment issues show the best technical patterns. As for individual issues, suggest the list in my letter of August 11th entitled Stocks With Favorable Technical Patternn. September 7, 1948 EDMUND W. TABELL SHIELDS & COMPANY Closings ,. Dow-Jones Industrials 185.36 .. Dow-Jones Rails Dow-Jones 65-Stock 63012 69.82 ,. — ,. The opinions expressed in this leiter are the personef interpretation of eMrt, by Mr. Edmund W. Ti!lbell and are not presented as the opinions of Shiefdl 6. Gornpeny.

Technical Market Action One thing has been pretty definitely proven by the action of the market in the past two days and that is that the fear of war, or some disturbance in the Berlin zone, is the prime element that is influencing the short term trend of the market. After the excellent technical action of Tuesday, the bad turn in the Russian news completely turned the market around and in two days the market declined from highs of 185.6 and 63.25 in the Dow-Jones industrial and rail averages to lows of 179.7 and 59.89 on Thursday. In a market influenced mainly by fear hysteria, almost anything can happen temporarily. However, as yet, there has been no basic change in the pattern. The market is still above the August 11th lows of 177.0 and 58.25. Volum& indications are still favorable. Thursday's volume increased to 1,200,000 shares due mainly to a turn- over of 570,000 shares in the final hour of trading. However, part of this heavy last hour volume was on a rallying phase. Even so, as noted in the table below, the volume has been decreasing in each of the four reactions of the past two months. Date July 19th July 30th Aug. 11th Sept. 9th Low 179.58 180.0 177.0 179.7 Volume 2,6(J)0,000 1,30,000 1,310,000 1,200,000 Of course, increased liquidation could change this pattern but the market is getting close to an oversold position on the market indicator which successfully forecast the turning points of the last three declines. Two or three hours more of moderate decline,followed by a diminution in the rate of decline, would produce another buying signal. Just when the unfavorable news pattern will change is open to question. My opinion on the foreign situation, like that of a great many commentators and columnists, is worth nothing. However, I doubt that there will be a shooting war. The sHuation is something like living next to the noise of a boiler factory. There is nothing you can do about it, but pretty soon you get used to the din and don't even hear it. The present market is governed purely by a fear psychosis and anything can happen temporarily. However, I do not believe the longer term pattern has been changed by recent action. Before the present foreign situation changes radically for the worse, I believe a distributional area will be built up in the market pattern. That pattern is not evident yet. The only distribution is that mentioned in previous letters, the area of May to July. The downside indications of that top were 182-178 on the industrials. The low was 177.0. The indication on the New York Times average was l16-11 and the low was 116. The indication on the New York Herald-Tribune average was 121 and the low was about 122. Thus, there is a l,ittle leeway en the last two averages. Also, a full two-thirds retracement of the February-June rally would indicate 175 on the Dow-Jones industrials. Before a lower indication would be given, the market mu,t rally nearer the 193 top, say to 189-192, fail to penetrate and then drop down below the lows of 177. O and 58. 2 or whatever 'lows are reached on this reaction. In that event the major trend would be down. But before that happens, a sharp rally must ensue. My opinion remains the same. We are in an advancing phase of the market. If the low has not already been reached at 177.40 it will not carry much below 175. EDMUND W. TABELL September 9, 198 SHIELDS & COMPANY The opinionl expreued In this leiter are tke personal interpretations of charts by Mr. Edmund W. Tab4! and are not pres.nted as the opinions 01 SI'IIelds & Company.

Technical Market Action There is. little new to be said about the market. The news from the Berlin zone continues to be the main motivating influence behind prices rather than internal conditions of the market itself. Technical indications gave no warning of last week's sell-off. The market appeared strong technically at last Tuesday's close. The ensuing decline was caused by news happenings rather than a weakened technical condition. I a market that declines because of fear of impending happenings, the reversal can be quite sudden when the expected fails to happen or the news changes suddenly. In the present state of fear hysteria, anything can happen temporarily. However, the market has not built up a distributional area that usually preceeds a sharp decline in the market. A penetration of the August lows, while it might bring in some stop loss selling, would not be of long term significance. It would simply indicate a continuation of the secondary downtrend to a full two-thirds of correction of the 3D-point advance of February to June. It might bring the averages down to 175. What will happen in the next two weeks depends largely on news developments. With many investors and speculators on the side-lines, it takes very little buying or selling by a jittery public to cause sharp advances and declines. The technical indicator that signalled the bottom of the declines of July 19th, July 30th and August 11th, gave an oversold signal on,the close Friday, but the market failed to follow through. Sometimes a day or two delay occurs before the market turns. September 13, 1948 – EDMUNDW; TABELL — – SHIELDS & COMPANY Closings Dow-Jones Industrials Dow-Jones Rails Dow-Jones 65-Stock 179.38 59.72 67.28 ,' Tho opinions expressed In this lettor are the penonal interpretallons of charts by Mr. Edmund W. Tabell and Bro not presented as the opinions of Shields & Company. \ —