Tabell’s Market Letter – April 15, 1966

Tabell’s Market Letter – April 15, 1966

Tabell's Market Letter - April 15, 1966
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-,ih Walston &- Co. —–Inc —-INVESTMENT BANKERS MUTUAL FUNDS MUNICIPAL BONDS Members New York Stock Exchange OthHlth'nfijS.'I1Stock and Commodity Exchanges OFFICES COAST TO COAST AND OVERSEAS TABELL'S MARKET LETTER April 15, 1966 Following the April 5th upside breakout by the Dow-Jones Industrials from the 910- 938 range, which had contained the index for five weeks, the Average reached a temporary top and reacted to an intra-day low of 932.51 on Tuesday. This was precisely where one would have expected it to meet support and, indeed, the latter part of the week was charac- terized by a good deal of strength with an intra-day high of 957.40 being reached on Friday. The big news, however, was volume. Thursday's trading activity of 12, 980, 000 shares was the third highest single day's figure on record and the highest volume day in the history of the Exchange on which the market closed up. — wa-Sl'lot,all-thatmonumentalba-st-Octoberrc-when— — volume was expanding, this letter pointed out that the level of trading activity was hardly surprising. We suggested at that point that the only sensible way to look at volume was in relation to the number of shares listed, a statistic that had been showing a dramatic increas over the years. We pointed out that if volume reached the same level in relation to shares listed than it had in 1946, 1955 and 1962, 20,000, ODD-share days would be commonplace, and if it reached the same level at tained in October 1929, total trading volume would be 146,000,000 shares. Actually, the true significance of the high level of volume has gone largely unnoticed. If history is any guide, the continued ability of the market to continue to generate a high level of activity is the best insurance against any immediate major decline. Let us analyze this a bit further. There is a tendency on every major upswing in stock prices for volume to expand sharply.H has done so frsm 1962 to date. Subse- ! quent to that low, the lowest monthly volume of N. Y. S. E. d' 6 ,890,000 shares in September of 1962. Since that time the highest figure.3!9h s b 191,524,000 shares last month. If activity continues at this level ana r new high will be made. A similar expansion of volume has ii\J&'er ajor rise in the past. The following table which shows the low h e f e upswing and the date of high — – – monthly volume reached during the–pe' -1- 0 – – te– t. – It shows that in no case In I'Ie;orded ' , market history has a high in ume. In two cases, the hi h in 1 nrh.1ials been reached prior to a high in vola d in the Dow were reached in the same month. In every other 'n 1e volume led the peak in the Dow by times ranging from one to ninete,. Stock Mkt. Low Sub nt – Monthl Volume April,1897 anuary, 1901 Nov. 1903 January, 1906 Nov. 1908 August, 1909 Sept. 1911 April, 1912 Dec. 1914 November, 1916 Dec. 1917 October, 1919 Aug. 1921 July, 1932 January, 1929 January, 1936 March, 1938 October, 1938 April, 1942 January, 1946 June, 1949 January, 1951 Sept. 1953 – January, Oct. 1957 January, 1959 Oct. 1960 March, 1961 June, 1962 March, 1966 (to date) does not include May, June, July 1933 Subsequent High DJII June, 1901 January, 1906 October, 1909 September, 1912 November, 1916 November, 1919 September, 1929 March, 1937 November, 1938 May, 1946 August, 1952 April, 1956 January, 1960 November, 1961 Lead Time 5 o 2 5 o 1 8 14 1 4 19 12 8 , What the above strongly suggests, of course, is that the high for the Dow-Jones Industrial Average on the present upswing has not yet been seen. It is true, as the volume expansion shows, that we are in an advanced stage of the upswing and there are enough symptons of deterioration in the present upswing to make us not want to count on any substantial new advance. History does show us, however, that expanding volume — at least as long as it continues to expand — is a positive factor. Dow-Jones In d. -947.77 Dow-Jones Rails -263.16 ANTHONY W. TABELL WALSTON & CO. INC. AWTamb This market Jetter UI published for your convenience Itnd mformatlon and if! not an offer to sell or A solicitation to buy any aeeurltles dlsettASed. The tnsenfonnntlon was obtaaned from sources we beheve to be reluthle, but we do not RUl\rantee Its accuracy, Walston & Co. Inc. And Its officers, dIrectors or tm'IJ'IOyceB may have an interest In or purchASe and the securities referred to herem – , , ,,

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