Viewing Month: May 1952

Tabell’s Market Letter – May 16, 1952

Tabell’s Market Letter – May 16, 1952

Tabell's Market Letter - May 16, 1952
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– – …. — ….- – – – – – – – – – ');'i;V;;,,- T/–'—j' -, lVolstoll.Hoffnton &-Goodwin,,' '.' -',' .' ,', '.' ,/ 1,,'.., ;11., &p'6flU.n,eN& (,ket!e-r , '' f i,k It;; NEW35DIYO,R'.KS.t5,,.Nt Y 4 'll PHILAYDELKPHEtI.At2;,;,'P/A 550 5t,..t .,oS'llt,.et ;;;olOS ANGELES 13, CALIF SAN FRANCISCO 4, CALIF, 2b5 .- ,',' 1',1 1A!E!.!S MARKET LETTER .. , — i, . W, ,. y ; ;;' The Dow-Jones industrial average was in a slow downdrift most of the ',,', \week. The intra-day low was reached on Thursday at 258.66, but the low \;,- losing was on Friday at 259.62. The industrials have been in a downtrend . ince the January high of 276.26. The March high was 270.40 and the May high' i'flras only 263.77. Ability to cross above the downtrend line 'connecting the ,- 1IJanuary and March highs would be very constructive technical action. The , ('line now stands at about 266. However, a decline below the 255-254 support r, ;,I!-rea would be discouraging and indicate a further decline to most likely the, 145-235 support level. ,' 1/'1'1,' vlhile the industrials have been in a downtrend since January and a ;I, iiSidewise movement since August, the rail average has been in an uptrend. The,', ;,uptrend line from the February low of 82.51, which now stands at 92, still ,, ',emains intact although it was closely tested at Thursday's low of 92.40. ;';f this uptrend line were broken, it would indicate a testing of the more ., ,,i1mportant uptrend line from the June low of 71.78. This uptrend line cur- / ' 'rently is at about 87. A oownside penetration of this line would be almost 'Cas important. to the rails as a dC;/nside penetration of the 255-254 support ,i,,', Vi!-evel would be to the industrial average. On the upside, the rail average ; , as still as its upside objective the broad 98-94 range. The high so far ; '. ,bas been 95.73. , i) Regardless of the ultimate action of the averages, the important thing' ( ' ,t o watch is the action of individual issues and groups. Many groups still ',,-, ;;,1jI.ppear technically vulnerable but others are approaching what appears to be — ,buying pOints. I have mentioned the textiles and airlines in recent letters . ','l'his week Celanese reached a new low at 36 7/8. I have brief technical !iomments available on almost every issue on the New York Stock Exchange and p,. Qn quite a few New York Curb issues. My technical analysis on Celanese now ,. ;x-eads ', At the August high of 58, the stock had reached the long term ( i;' objective of 56-64. The downSide penetration of the 58-48 area i' ; indicates a decline to 40-35. This objective has been approxi- ,. r;;; mately reached at the recent low of 37. Some time may be re- ,,1 quired to form a base, but the stock should be bought in the ;; i( 40-35 area. ,. 'd J; Another group that appears to be approaching a sold-out condition is 'I,,' ;,;f,he distilling group. The liquor companies have also been facing adverse ;,. – ;90nditions. Whisky price controls probably will soon be suspended because ',' '-the industry- faces an oversupply. Sales have dropped sharply since the tax ; 1was raised 1050 a gallon on November 1st and inventories have increased. iI;!owever, as noted in the tabulation below,these issues have declined cfrom 2 i,to 39 from their 1951 highs and are approaching their downside objectives F' ;'!bn my technical work. The prices below are to the hearest full figure I', f;j Price 1951 1952 De- Earnings '( 5/16/52 High Low Cline 1222. 1951 1952-A ,', I;Amer.Distilling 38 58 37 36 4.71 5.22 1.74-B 'i' jBrown Forman 11 18 11 39 4.71 .75-C N.A. ',' wistilling Co. 213 31 22 29 4.77 4093 2. 23-E Glenmore Dist. /'National Dist. 4 20 14 30 3.56 2.95 26 37 26 30 3.45 2.87 .40 ''-.38 ., ,;!'ark & Tilford 37 57 37 35 5.10 4.04 .27-D 'Schenley 26 41 6 37 8 . 47 5.10 1.94-F ;',,iram-Walker 43 56 it3 23 9 68 7.23 2 .52-F ' !! ' \1, I,',. A-three months March, 1952. B-Six months March,1952. C-Six months Oct.195h,' ) D-Deficit. E-Six months January, 1952. F-Six months February 1952. ;,'- , ).1 1 National Distillers and Schenley appear the most attractive. They l,should be bought during periods of price weakness not on strength. '!',; May 16,1952 EDMUND W. TABELL WALSTON, HOFFMAN & GOODWIN , t!,',,1'11 Dow-Jones Ind. – 259. 82 ',,, Q Dow Jones Rails 93 56 i', , Thil memorandum i5 not to b. COI'lltrued U 0111'1 offer or solici'ahon of offers to buy or sell lIl'I'f ulc\H,ties From hme 10 'Ime Waldon, Hoffman & GoodWin may),!., ;' holl ….. an in'ered in some or all of the securities mentioned herein The foregoing material has bel!ln prepared by us as a m;1lttlllr of information only It It bated J!' 'I' l.I;on information believed r'!!llbl. but not neceArlly complete, is not ;uaranleed III accurllte or IIMI, and is not intended to foreclose Independent Inquiry,,', (,!I.'',-',.,,'-;''r\i,'-';,';',' ,',',',' ', , , ,,',;' ,-. ',

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