Tabell’s Market Letter – April 02, 1954

F;'i'– Walston &Co. MEMBERS NEW YORK STOCK EXCHJlNGE AND OTHER LEADING STOCK AND COMMODITY EXCHANGES NEW YORK PHILADElPHIA LOS ANGELES SAN FRANCISCO LUGANO ISw,twlood) OFFICES COAST TO COAST CONNECTEC BY OIREC1 PRIVATE WIRE SYSTEM TABELL'S MARKET LEnER April 2, 1954 The Dow-Jones industrials reached new high territory during the week at 307.95. The advance has been rapid and some consolidation may be needed but the longer term trend still pOints toward higher levels. As I suggested at the beginning of the year, I believe the industrial average will reach at least 325 during 1954. However, the action of individual issues is much more important than that of the averages and I am reviewing below the technical patterns of some of the issues mentioned by me during the past six months or so. The balance will be reviewed next week. ABBOTT LABORATORIES still continues to hold in the 40-47 area. Appears to be building a base pattern and should be held and bought in the lower part of the trading area. \ ALLEGHENY LUDLUM STEEL was recommended at 28. Has recently held in the 28-33 range and appears to be under accumulation. A very interesting long term appreciation possibility. ALLIED STORES was suggested for purchase at 38. It has broken out on the upside of the long 36-40 trading area, in which it held for two years, to reach 44. There is some supply at 44-48 which may slow action, but the up- side objective is 55-65. There is support at 40. ALLIS CHALMERS was recommended in the 42-45 area and moved up to 52 and back to 47. Appears to be slowly building up an accumulation area and should be bought on weakness. ALPHA PORTLAND CEMENT appears to be in a slow uptrend with an eventual ob- jective of 60-75. Buy on minor price dips. The 46-43 area should furnish good support. ALUMINIUM,LTD. has rallied from a September low of 44 to 57. The long term objective is 60-65, but the pattern may broaden. Would hold and buy on minor weakness. AMERICAN NATURAL GAS has moved from 34 to 45. The upside objective was the 45-50 level so would be inclined to take profits on strength. AMERICAN RADIATOR has built up a very strong technical pattern. Has held in the broad 12-17 area. An upside penetration would indicate an ultimate objective of 27 or higher. There is temporary supply at 20-22. AMERICAN TEL & TEL has been my favorite investment income issue. A high of 165 was reached. The first objective was 165-167 followed by 171-179. There is support at 161-159. AMERICAN VISCOSE. This issue may require some further patience but it ap- pears to be building up a slow base pattern. Would buy in the 35-30 range. BABCOCK & WILCOX has moved up nicely from 36 to 51 but still indicates higher long term levels. Would continue to hold and buy on weakness. There is support at 47-45. BENDIX AVIATION has also shown Sizeable appreciation from 47 (after adjust- ing for stock dividend) to 70. The long term objective is 80-90, but some prior consolidation may be needed. There is support at 65-62. BLACK & DECKER was recently recommended at 39. It has broken out on the upside three-year 32-40 area to reach 43. The intermediate term objective is 45-51 followed by a long term 70-80. There is support at 40. An inte- resting technical pattern. BLAW KNOX has been very slow but has built up a very strong pattern with an upside indication of 28-33 followed by an even higher long term object- ive. Believe the present 19-20 area is a buying range. BUCYRUS ERIE seems to be in a slow uptrend to the 36-43 area. Action may be slow but the long term road building program favors this issue now selling at 24. There is nearby support. BURROUGHS has held in the 13-18 area since 1946. An upside penetration would indicate 35 over the long term. An interesting issue for patient holding. CERTAIN-TEED has rallied from 12 to 15 but is still in the confines of the broad 12-18 range. This appears to be an accumulation area with a sizable long term objective. Continue to hold and buy on weakness. CHAIN BELT. This issue, which has paid dividends since 1902, appears to be behind the market. It has a very constructive technical pattern and is suggested for income and long term patient holding. The long term object- ive is 65-80. Th, memorolndum IS not to be COluirued ,H 011'1 offer or soitCltatlon of oHers 10 buy or sell any ecuflttes From lime to lime Waldon & Co, or ilny p,utner thereof mal hay! an orileresi in some or al! of the securtiles mentioned herein The foregOing mlltenal hil5 been prepared by us as a rnltier of Inlormahon only It IS b.lled upon tnformatlon believed reliable but 1'101 necessarIly complete, 15 not garlfIleed as accr … te or final, and I not Intended to fQrecloe Independent ,nq – r. Walston &Co. MEMBERS NEW YORK STOCK EXCHANGE AND OTHER LEAOING 'STOCK AND COMMODITY EXCHANGES NEW YORK PHILADElPHIA LOS ANGELES SAN FRANCISCO LUGANO (Sw,',,d) OFFICES COAST TO COAST CONNECTED BY DIRECT PRIVATE WIRE SYSTEM TABELL'S MARKET LETTER -2- COMBUSTION ENGINEERING hs a very similar pattern to Babcock & Wilcox.From flga6regcolmmended level of 45, it has moved to 56. The pattern still indicates levels and would hold and buy on minor weakness. 'C' IThliR CORP. has rallied from 36 to 51. The upside objective was 50 so would be inclined to switch into other recommended issues. CORNELL DUBILIER has rallied very sharply from 22 to 32. Most likely needs some consolidation but would buy on declines to;the 28-26 area as the long term objective indicates above 40. CRANE CO. has advanced from 28 to 34 but still has a strong potential pattern. Ability to reach 35 would, from a technical viewpoint, indicate 4045 followed by an even higher objective for the long term. DEERE & CO. seems to be building a new accumulation pattern in the 23-29 area but there is upside resistance that may slow action. Would await correction to the 25 level before purchase. EAGLE PICHER has done little marketwise, but at present level of 20 it is near the low of 18. Seems like an interesting issue for good yield and patient holding. , ELLIOTT CO. still appears to be in a slow uptrend channel with support close to the market. The long term objective is impressive but near term action may be slow. EL PASO NATURAL GAS has moved up from 30 to 37 but is still holding in the three-year 30-38 trading range. An upside penetration would indicate 45-50. Buy on minor weakness. FLINTKOTE has done little marketwise but appears ,to be building a very strong technical pattern. Now selling at 30, the ability to reach 34 would be very constructive and indicate the probability of much higher levels. FLORIDA POWER & LIGHT was suggested at 33 and has now moved to 43. Seems high enough for the time being and would switch to other recommended issues. FOOD MACHINERY has moved from 34 to 41 and back to 39. Appears to be slowly building a base pattern and should be bought on weakness. There is support at 38-36. GENERAL RAILWAY SIGNA!, has done little marketwise and is selling neap its low. It is in a strong support area however, and appears to'be building a base in the 25-31 range. Buy for long term appreciation and income. GLIDDEN COMPANY has an irregular pattern but appears to be a purchase in the 33-30 area. HEWITT ROBINS is a recent recommendation. Ability to reach 30 1s very constructive. The technical indication is an intermediate term 37-43 and a longer term objective above 50. An interesting purchase. INDUSTRIAL RAYON has one of the stronger patternsin the textile group. It has held in the 39-45 area Since early 1953. The upside potential is 55-57. An interesting purchase at 43. INLAND STEEL has one of the stronger steel patterns. Has reversed its down- trend and appears tO,be slowly building a base. Now at 46, it should be purchased on minor weakness. INTERNATIONAL HARVESTER has rallied from 25 to the 31 resistance level. Other issues appear to have better appreciation prospects. INTERNATIONAL PAPER has moved from 45 (after adjuting for 10 stock dividend) to 63. The objective is 70-75. JOHNS MANVILLE was originally recommended at around present levels of 63. It rallied to 71 and formed a top with a downside indication of 64-61. Stock should be bought. JOY MFG. I believe this issue, at around 33, is undervalued. It has a strong technical pattern with an intermediate term objective of 45-49.1 suggest its purchase. KENNECOTT was suggested at 63. It has reached its first objective at 75 and would await a decline before purchase. There is support at 70-68. MARTIN, GLENN L. advanced from 13 to over 25. The upside objective mentioned in our February 12th letter was 25-30 so the stock has reached the lower part of its price range objective. MEAD CORP. The upside penetration of the 23-28 range indicated 32 follow- ed by 41-43. Has reached 33. May need a little consolidation but hold for higher levels. EDMUND W. TABELL WALSTON & CO. Th, m('mQf,lndum I not to be construed .H .!Hl offer or soilc,tailon of offers 10 buy or seU any seeu,,es From lime to time Wallton & Co, or o'Iny partner the'eo! m.1V hilc HI Intercs' ,n lome or all of the securities mentioned herein The foregoll'!g material !'las been prepared b'r' us a il mailer 01 Inlormahon only It 1 b,lleo upo') Info,mahon bet,,ed relIable but not neceHarlly complete, II not qua'dnleed al acc\Hatc or fll1i1I, and I no! Intended 10 foreclOI(l Independent InQV