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Walston &- Co. —-Inc —- Members New York Stock Exchange and Other Principal Stock and Commodity Exchange. OVER 100 OFFICES COAST TO COAST AND OVERSEAS TABELL'S MARKET LETTER June 27, 1969 For those who believe that market bottoms must be active affairs with late tapes and all the classical signs of a selling climax, last week's action offered little to confirm the hope that a bottom had been reached. The Dow-Jones Industrials staged another minor rally from noon Monday to noon Tuesday, but spent the rest of the week sliding off and posted a new closing low on Friday at 869. 76, although the intra-day lows on Monday, Thursday and Friday were at around the same level. For whatever it is worth, the Dow showed the least favorable picture of the market. On both Thursday and Friday the S&P 500 advanced, there were more advances than declines, and upside volume, as measured by Quotron, exceeded dr-oiwsen.sid-e volume. – – -tQl5N-k-1-l-t.it.though,it.was,hardly.a.vigorous.mar.ket It would be difficult, in view of last week's action, to assert with any confidence that the nadir of the stock market slide had been reached. Indeed, based on past experience, probabilities actually favor a lower market over the near-term. However, — and it is im- portant to understand the distinction, — the proposition that stocks have reached what will ultimately prove to be an attractive buying level, is a good deal easier to defend. Let us see if we cannot document this proposition a bit further. As we noted in last week's letter, the market had, by the low of last Monday, reached what can be called a deeply oversold position and had, by the end of that week, rallied sharp ly from that position. Now, the term oversold is one of the more abused in the stock mar- ket lexicon, but we refer here to the number of declining stocks over a relatively short pe- riod measured against the number of issues traded. without going into de- tail, that prior to this year, the market had reached a co a a level only fiftee times since 1956. ((0 The dates of the fifteen occurrences are t e w. In each case, the dat is three days after the maximum oversold condition ea ,making it comparable to the close of Thursday of this week. The falr ere sting. The first column 11 e tly.-r.eached-1ow.Ascanbeseen, the market did, in fact, move on t een occasions, and on three of those occasions a further . What is more interesting, howeve is the percentage chang . months later and a year later. In thirteen cases out of fifteen, the ar w,' e x months after the registration of an oversold positio comparable to that k in fourteen cases out of fifteen, it was higher a year later. The numerous arp es recorded document the fact that conditions such as those evidenced this week hav een present at every major bottom in recent market history. This is a record that is dif cult to ignore. CHANGE IN DJIA Date At Next Low Six Months Later One Year Later 6/4/56 10/4/56 10/24/57 9/23/59 9/30/60 6/7/62 6/27/62 10/4/62 10/31/62 6/17/65 5119/66 8/3/66 -2 -5 -3 0 -2 – 11 0 -4 0 -5 – 15 – 12 2 1 6 -1 19 7 21 22 22 9 -9 2 4 -3 24 -6 21 21 33 27 29 2 1 8 9/1/66 -6 7 13 10/12/66 -1 13 19 2/21/68 -3 9 10 Whether this week's action will-constitute a major bottom such as 1957,1960,1962 and 1966, an intermediate turning point such as those of 1956, 1965 or 1968, or a prelude to lower prices such as 1959 or May 1966 is, at the moment, difficult to say and the answer will probably be afforded only by subsequent action. It would appear, however, that an interesting juncture lies just around the corner. ANTHONY W TABELL Dow-Jones Ind 869.76 Dow-Jones R81ls 212.62 WALSTON & CO INC .. This market letter IS Ilubhshed for your convcnll'nce nnd mfO malmn nnd 1'1 not fin offer to aell 01 It '1oltutntlon to buy lin) M'euTltles dlscua'Joo The Informntlon WII'! obtamed from source!! we hellevl' to be rl'it.ll.l', but we do not gUHrantec its accuracy Wtlston . Co, Inc und Its officers. duectors or employees may have an Ultercat m or Jlurchase alld sell the SeCUritLes referred to herem. WN.sol ..an. aiLi ,'lUi'aa& Ii ….Wi ..