Viewing Month: December 1971

Tabell’s Market Letter – December 03, 1971

Tabell’s Market Letter – December 03, 1971

Tabell's Market Letter - December 03, 1971
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. – ————-,– TABELL'S MARKET LETTER I I I J 909 STATE ROAD, PRINCETON, NEW JERSEY 08540 DIVISION OF MEMBER NEW YORK STOCK eXCHANE INC MEMBER AMERICAN STOCK eXCHANGE – December 3, 1971 'Ife. g.'.v9Jed.J!ltL!P1!CJ'Lljst.Y!T,ee, t9 discussingtQdackoL convJctjoll,in .alloLJPe .rally. attempts.- prior to last Friday and suggested that, in the light of that unimpressiveness, stock prices could well, over the near term, head lower. Almost as the ink was drying on the page, the market started on a four-day advance of sufficiently overwhelming proportions as to convince even the most skepti- cal that some sort of reversal had occurred. Thus another short-term forecast bites the dust, although, as will be detailed below, we are not yet totally sure whether the forecast has been proven wrong or merely interrupted on its way to fulfillment. In light of last week's action, there are three possible interpretations of the present stock market position. They are as follows I) The present rally cor.stitutes nothing more than an interruption in the context of a larger overall downtrend. If this is the case, we should expect the rally to abort fairly shortly not too far from current levels and in due course to be followed by continued distribution and new lows. 2) The bear market which began in April is not over, but the present rally will be of intermediate term proportions. If this is the case, higher levels are in prospect, with the plausible target for such an advance being somewhere around 880 on the DJIA. Such a rally, since the time has come for the market's normal year-end advance, could well carry until after the first of the year. The 880 level, moreover, is plausible for a number of reasons. First of all it constitutes the first major area of supply which the Dow should encounter on the upside. Secondly, it is the top of the downtrend channel which characterized the market since the April highs and, thirdly, most longer-term moving averages will, by the end of the year, be around this level. . – J ) The bear market endedon.November23and aLnewupsurgeof.rna!orc-clepropOItions..hasbegun., If this scenario is correct, an appropriate period of rebasing, which could last for the next 2-6 months, should be fOllowed by a typical bull market takeoff. Now, obviously, sufficient evidence is not yet in to allow us to choose between the three above interpretations with a high degree of certainty. The strength of last week's rally appears to make the first the least likely. Most intermediate-term oscillators rebounded nicely from their four-week- long deep oversold position. Moreover, breadth actually led the Dow on the upside, a condition typical of the initial rally of intermediate and major bottoms. It, therefore, becomes relatively un- likely that the momentum generated by last week's action will be disapated over the very short term. Th, forecaster's task over the coming weeks, therefore, will, it seems to us, be centered on trying to distinguish between an intermediate-term advance and the preliminary stages 0 f a m a j 0 r rally. ffirein lies a paradox, for we have now reached a point where further short-term strength would probably be less indicative of a healthy technical condition than consolidation or weakness. The market, at the moment, has an insufficient base to suggest much more than a move to the 880 supply area mentioned above. The most meaningful action, therefore, would be a broadening of the base at current levels so that a worthwhile rise could ultimately be projected. There is an unfortunate tendency in looking at stock market history to think in terms of the most recent cycle, and not to look two or three cycles back. The last major market bottom, 1. e., that of May-July, 1970, was, in many ways, dissimilar to previous such reversals. The market staged its initial climactic rally in May. After an advance from.631 to 720, ..it.staged a .small retracemenLin .. early July getting no lower tha;; an intra-day bottom of 665 and, only two months after the lows, started its advance. This is not, we should be reminded, the way most major bottoms have, in the past, formed. In 1966 the initial climax rally from 760 to 822 in August was followed by a move to new lows at 736 in October. Likewise, in 1962, the initial reversal took place in May and was followed in due course by a lower Iowa month later and another equivalent low, six months later, in October. 1957 did not see a new low after the first climax rally, but the low was tested on four sub- sequent occasions over a six-month period before the next advance finally started. What we are suggesting is that there is very little point in concluding that, if last week's strength follows through, the opportunity to buy stocks at attractive levels will be lost forever. Indeed, history suggests that the normal basing process should provide an opportunity to buy them at levels at least as attractive as the present ones, and with a good deal more confidence. Dow-Jones Industrial (Noon) 854.41 S&P (Noon) 96.27 AWTmn ANTHONY W. TAB ELL DELAFIELD , HARVEY , TABELL No statement or expression of optnlon or any olher matter herein contained IS, or IS 10 be deemed to be, dlrectlv or indirectly, on offer or the soliCitatIon of on offer to buy or sell ony secunty referred to or menlione-i The motter IS presented merely for the conV'erience of the subtlber While oNe believe the sources of our Informo 'Ion to be rehoble, we In no way repren' or guarantee tfle accuracy thereof nor of Ihe slatements mode herein Any action to be taken by the subnber should be based on hiS own inVestigation and Information Janney Montgomery Scali. Inc, as a corporation, Clnd lIS offIcers or employees, may now have, or may latcr tak. posilions or trades In respect 10 any s.eQlflties menhoned In thiS or any future Issue, and such poSItion may be different from any VleW5 now or hereofter expressed In thIS or ony other Issue Jonney Montgomery Scalf, Inc. which IS regIstered WIth the SEC as on Investment adVisor, may gIVe adVice 10 Its Investment adVISOry and olhel customers ,dependently of any stalements mode In thiS or 1M any other Issue. Further information on ony CUflty mentioned herern IS avmlable on request

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Tabell’s Market Letter – December 10, 1971

Tabell’s Market Letter – December 10, 1971

Tabell's Market Letter - December 10, 1971
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TABELL'S MARKET LETTER ,,L' , 909 STATE ROAD, PRINCETON. NEW JERSEY 08540 DIYISION OF MEMBER NEW YORK STOCK eXCHANGE, INC MEMBER AMERICAN STOCK eXCHANGE December 10, 1971 Although it was understandably unable to gain further ground in last week's trading, the stock market was almost as impressive marking time as it had been going up. Last Friday's closing high ,of 859.59 on , – -the-Bow-has7a-s-of etht. wrtttng;-'remained-the'high forthe' mbv-e-But -ih-term-S''oI tlleniOre- coinpteliens ive- – measure of market breadth, gaining stocks continued to exceed losers, at least for the first three days of trading during the week. Moreover, repeated attempts to mount downside momentum were beaten back by impressive outbursts of demand. After the advance finally turned down early Monday and gave up some 18 pOints by Tuesday noon, an impressive afternoon rally turned the market up on the day. An attempt to reverse this advance on Wednesday morning was equally unsuccessful, with strength again emerging in post-noon trading. By all measurable standards of breadth, volume, etc., the 10 days ended last Wednesday com par e favorably with similar 10-day periods around major bottoms such as May, 1970, October, 1966, etc. Yet a closer look at market action suggests a few questions, and they will herewith be raised. The market's performance, as we said above, was impressive but in a way it resembled the performanc of a romantic comedy by a 67-year-old ingenue and her 73-year-old leading man — competent and profes- sional beyond doubt, but with a cast of characters that was, to say the least, familiar. The following table is indicative of what we mean. The Dow had been down by 16 between April and November but a whole host of securities, the three we have selected as examples below being typical, had resisted the decline and advanced sharply in the face of a weaker, overall market. Predictably enough, it was these issues which led the parade on the upside demonstrating a much better-than-average advance once the market pressure had been removed. April, 1971 High Nov., 1971 Low Chg. Recent High Chg. Dow-Tones Industrials 950.82 797.97 -16.1 859.59 7.7 – -LCvointszo'lFiudrantietdurFere-ig htways — 38 5-0 – 45 18.4 56 24.4 92 84-0 – ITS — — 14-1.–4— Winnebago Industries 17 – 32 46.9 47 46.8 It may be argued that we have chosen unusually volatile issues for our example but the same argument can be applied with equal force to a host of blue chips as witness the following. Except for the fact that the moves are less wide, the same principle applies. April, 1971 High Nov., 1971 Low Chg. Recent High Chg. Dow-Tones Industrials Eastman Kodak 950.82 86 797.97 82 -16.1 -4.6 859.59 92 7.7 12.1 Proctor & Gamble 62 70 12.9 77 10.0 Sears Roebuck 91 88 -3.2 99 12.5 The stocks mentioned above have undoubtedly moved up for good and sufficient reason and may well continue to do so. But the trouble with this sort of process is that it cannot go on forever. At some point in time the stocks which were totally unaffected by the six-month downswing just ended and which now dominate the expanding new high list are gOing to complete the process of discounting their near- term potential and, if the advance is to be sustained, new leadership will have to be found. Ins pection of existing technical patterns at the end of last week revealed precious little of this sort of new leader- ship emerging. Now we are perfectly willing to admit that'the sort of new leadership necessary for a sustained advance may well develop over the next few months. This, indeed, is precisely what happened in the Summer of 1970 when, over a three-month period, a whole group of market leaders quickly formed impressive base patterns. We are simply pointing out that such development has not occurred to date. We would, further- more, -view the continued domination of the market by-that- miiic'-ritY'of 'is su-es which resisted the down- swing as a less-than-favorable development. The truism that those who do not learn from history are doomed to repeat it is as valid for the stock market as anything else, and two historical periods which we think are pertinent to the present are Tanuary-October, 1960 and December, 1968-Tuly, 1969. Both were declines roughly equal to the present one both in time and amplitude. In both instances a substantial group of issues ignored the decline and advanced or at least held steady throughout the period. Both were followed by rallies, 1960 by the 1961 move which carried the averages to a new high, 1969 by a less dyna- mic move in the averages but one which, nonetheless, featured strong moves in individual stocks con- tinuing to Tanuary, 1970. In both cases, however, the advances were narrow and featured the same familiar cast of issues moving ahead with their strength concealing underlying distribution in the bulk of stocks. Were the same sort of thing again to occur in the present instance, equal caution would be re- quired. Dow-Tones Industrial (Noon) 854.71 ANTHONY W. TABELL S&P (Noon) 97.24 AWTmn DELAFIELD, HARVEY, TABELL No sfolemen! or expression of opInion or any other motter herein cantolned IS, or 15 to be deemed to be, directly or indirectly, on offer or Ihe solicitation af .on offer to buy Of sell any security referred to or menlloned. The matter 15 presented merely for Ihe converlence of the subscrober. While we believe the sources of our mfarma tlon 10 be reliable, we m no way represent or guarantee the accuracy thereof nor of the statements mode herem Any aellon 10 be token by Ihe subSCriber should be based on hiS own IOvesllgo1ton and Information Janney Montgomery Scolt, Inc, as a corporation, and Its officers or employees, may now have, or may later take, POSitions or trades m respect to any SeCUrities mentioned on thiS or any future Issue, and such pOSlhon may be different from any views now or hereafter expressed on thiS or any other Issue. Janney Montgomery Scott, Inc, wtllch ' regIStered With the SEC as on onvestment adVisor, may give adVice to Its onvestment adVISOry and olhel customers ,ndependently of any statements made m thiS or m any other Issue Further onformatlon on any security menhoned herem IS available on request

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Tabell’s Market Letter – December 17, 1971

Tabell’s Market Letter – December 17, 1971

Tabell's Market Letter - December 17, 1971
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——— TABELL'S MARKET LETTER J – 909 STATE ROAD, PRINCETON, NEW JERSEY 08540 DIVISION OF MEMBER New VORK STOCK EXCHANGE, INC MEMBER AMERICAN STOCK EXCHANGE Hey, hey, anybody listening; hey, hey, anybody there December 17, 1971 Hey, hey, anybody listening ; ………….. anybody care CJ1JldtensChrislmgs,song Readers of this letter are aware that it has been our usto;;; to b; to taditt;,n ad- a';h-Dece;;ber , – to attempt to forecast the coming year. They are also aware that we have traditionally divided this fore- cast into two parts, the first part being a review of the year just past, and those factors therein which might bear on the year ahead. We will, therefore, devote this issue to a retrospective look at 1971. The only surprising thing about the year, actually, is that anyone should have been, in the slightest, surprised at what took place. The Dow, it will be recalled, advanced to around 950 at the end of April and spent most of the rest of the year declining. reaching a low of just under 800 at the end of November. The subsequent rally attempt has, so far, carried to around 870. For some reason, however, a great many commentators seemed to expect something different. The week before the April high was reached, the Wall Street Journal carried a front-page story about how it was considered, by most analysts, only a matter of time until the Dow hit 1000. As the weakness set in, incantations about the uncertainties of Phase 2 were muttered, as if the blame for the market's weakness somehow lay in the White House. And dire mutterings about 500, 400 and other ridiculous downside targets for the Dow, silenced during the bull market, again began to be heard. Yet what happened during 1971 was absolutely consistent with a historical pattern which is now more than seven years old. Until Wednesday's and Thursday's rally the Dow had been trading around 860. Let us consider this 860 figure for an instant. It is within 3 of 838.92 which happens to be the market close of December 31, 1970. Interestingly, it is alsQ with 3 of where the market closed September, 1964. During the intervening period, the Dow has never been more than 16 above the 860 level and has only briefly traded more than 15 below it. It has sold a t / or below the 860 level during 48 of the past 88 r-monthsandhasctraded.excLusi-velyabovethat.level.inAO.monthsIn-shott7…l!l7J.-was..simpl-y-a-continuik—t- tion of a market which, on average, has done absolutely nothing for seven long years. .( And nobody listens. The familiar investment rules learned in the environment of the rising markets of the 1950' sand 1960' s continue to be followed. Further strength will undoubtedly produce more rosy pro- jections about 1000 on the Dow. Before making any forecast for 1972, it seems incumbent on us to know why the market has behaved as it did and whether these causal factors can be expected to continue to operate. Of the myriad of numbers possibly having bearing on the subject, we present below five statistical series covering the past six years. The story is interesting. For all of the six years individuals have been heavy sellers of equities. This supply of stock was partially absorbed in the early part of the period by the fact that the public continued to make large mutual fund purchases thus investing in equities indirectly, and the fact that,untIl1968, at least, the net new issues of stock were relatively low. The tide of individual selling in the latter part of the period, however, when coupled with the phenomenal rise in net new Issues and reduced mutual fund purchases could not help but produce pressure on stock prices and indeed did so. Pension funds throughout the period have been a stabilizing force but, as will be dis- cussed next week, may be less so in the future. BILLIONS OF DOLLARS 1971 E Net New Issues of Common Stock .9 2.4 – .7 4.8 6.6 10.5 Individual Common'Stock Investment -4.7 -6.7 -12.2 -9.7 -4.3 – 6.0 Net Purchases of Mutual Funds 2.6 1. 9 3.0 3.0 1. 6 .5 Pension Fund Common Stock Investment 3.7 4.6 4.7 5.4 4.0 6.0 Net Foreign Common Stock Investment – .3. .7 2.1 1.4.–..6 – .3 Now we will wager that this may be the only forecast published this year which has gotten to the last paragraph without once mentioning the magic word earnings. The reason is, quite simply, that earnings are totally irrelevant to the question of why the market has behaved as it has. The explanation lies in supply-demand forces such as those referred to above. What happens in periods of insufficient demand for common stocks is, quite simply, that the price paid for earnings goes down. This it has been dOing for 10 long years. The peak price for a dollar of Dow earnings was 24.20 in 196L It has dropped to 16.10 in 1962, 13.40 in 1966 and 12.80 in 1970. If the factors outlined above perSist, there is no reason to eJqlect the price of equity earnings to improve markedly in 197L It is the question of the continuance of these factors which will be explored in our forecast next week. DOW-Jones Ind. (1100 a.m.) 872.07 S&P (1100 a.m.llOO.OO ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL AWTmn A VERY MERRY CHRISTMAS TO ALL No statement or expression of opinion or any other matter herein contolned is, or ,s to be deemed to be, directly Of ,ndlrectly. an offer or the 5..ll(ltotlon of on offer to buy or l.ell any security referred 10 or mentioned The mOlter Is presented merely for the conVel'lence of the subscriber While we believe the sources of our Informalion to be reliable, we In no way represent or guarantee Ihe accuracy thereof nor of the statements mude herem Any action to be token by the subSCriber should be boud on his own InYeshgotlon ond information Janney Montgomery ScaN, Inc, as 0 corporal lon, and lIs officers or employees, may now hove, or moy lofer toke, posItions or trades In respect to any s.ecutltles mentioned In thiS or ony future Issue, and wch poSition may be different from any views now or hereofter e)(pressed In thiS or any other Issue Jonney Montgomery Scott, Inc, which IS registered With the SEC as on Investment adVisor, may give adVice to Its mvestment adVISOry and othel customers independently of any statements mode In thiS or In any other Issue Further Information on any security mentlolled herem IS available all request

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Tabell’s Market Letter – December 23, 1971

Tabell’s Market Letter – December 23, 1971

Tabell's Market Letter - December 23, 1971
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,- – — , TABELL'S I MARKET , , , LETTER I ——— — — —- — J eIafo/d, Y&lI' 7ak1/ 909 STATE ROAD, PRINCETON. NEW JERSEY 08540 DIVISION OF fiJlnc/I /lun'10mcJ(.y .'/co fm;, MEMBER NEW YORK STOCK eXCHANGE INC MEMBER AMERICAN STOCK EXCHANGE December 23, 1971 ,.- . As the time arrives to issue a forecast for 1972 it is important, in order to know where the stock market is l1kely,ta'be' going ;tbknow'wh'ere 'ithas 'been'-'or;Omoreiinjlortantly, 'whV'ifhas been- -, I,' there. We noted in last week's letter that the stock market's journey in 1971 had, indeed, carried it over old ground since present prices are fairly close to the December, 1970 close of 838.92. We suggested moreover that the same had been true for seven long years, the Dow having been at its approximate current level as long ago as September, 1964. In partial explanation of this performance we enumerated a number of supply-demand factors which, we feel, go a long way toward explaining the character of the market since the mid-60's. These factors included heavy public selling of equities throughout the entire period compounded more recently by a reduced level of mutual fund purchases, a heavy increase in net new issues of common stock and reduced foreign buying of U.S. equities. We also suggested that a major stabil- izing force during the period had been continued pension fund equity purchases. Now the market in 1971, under the influence of these factors, spent the year between 800 and 950 on the Dow just as during the prevIous six years, with the same factors operative, it had tended to center around this range. It is, therefore, central to a 1972 forecast to determine whether any of these factors are likely to change radically. Let us examine them individually. It should first be pointed out that the poor maligned John Q. Public has been, essentially, correct in his decision to sell equities over the past six years. He has realized the central fact that, in order to achieve an above-average return in the stock market, it has been absolutely necessary to beat the averages, and he has realized that he is often ill- or,equiooed to do this. He has become well satisfied with record yields available to him either direct- Iy ., .. bonds I via a siiViiigs'-ass, …. .. u.,.,,,,s. 'rf'is . J, v , difficult to visualize his selling proclivities changing very much over the near term. The same reasoning tends to apply to the public's behaVior as a buyer of mutual funds. Net new purchases of funds could well improve as 1972 goes on, but, with the funds cash pOSition at a relatively low level, there should be a tendency on the part of managers to' sterilize this cash inflow at least in the first half of the year. New pension fund purchases should continue to provide a stimulus in 1972, but it should be remembered that a great deal of the growth from this source in the 1960's came from increases in the funds proportion of equities held. There is evidence that this proces s is now diminishing. Insofar as corporate new issues are concerned, the operative factor here has been the need to build liquidity coupled with the relatively high cost of issuing debt. Again the present available evidence suggests a heavy supply of new issues at least for the foreseeable future. Foreign buying could provide one source of short-term strength as international monetary doubts are stilled, but we doubt that this source alone is sufficient to produce a sustained rise. The obvious conclusion then must be that the market is, in 1972, likely to duplicate its 1971 per- formance, 1.e., spend most of its time in the 800-950 range, and we are thus willing to offer this projection as a forecast. Two factors, however, should be noted. The first is that, with any forecast, it is necessary to examine the influences which might cause it to change at some point during the year. If our 800-950 range is to be exceeded on the upside, we think a major reason,wilJ be a drop in interest rates .Lower available.interest rates,c,ouldreduce ' the level of public seiling, stem 'the lvel of new issues as it became cheaper to issue debt, and cuase pension funds to think less about bonds than they have obviously been doing. Strength in bond markets through the end of 1972 could thus, in our opinion, produce a better equity climate than we are now able to foresee. The second factor that should be noted is that 1972 is an election year, and the normal shape for such a year is a flat-to-down market during the first h'alf, followed by higher prices during the second half. Thus, our projected 800-950 range, if it is to be violated, is most likely to be ex- ceeded on the downside in early 1972 and on the upside in the latter part of the year. Dow-Jones Ind. (llOO a.m.) 883.13 S&P (1100 a.m.) 100.89 ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL AWTmn WE WISH YOU ALL A VERY HAPPY NEW YEAR No statement or expreS1OfI of opmion or cny alher matter here, contOlned IS, or ,s to be deemed to be, directly or ,mhrectly, on offer or the 5OlIe,totlon of on offer 10 buy or seH ony security referred fo or mentioned The matter IS presented merely for the conveflen of the subscrIber. WhIle oNe belIeve the sources of our mformo tion to be reliable, we In no way represent or guorantee the accuracy thereof nor of the statements mode hereIn Any adlOfl to be toen by the subSCriber should be bosed on tllS own Investlgallon and Information Jonney Montgomery Scott, Inc, os a corporatIon, and 115 offIcers or employees, may now have, or may later toke, poSItIons or trQdes In resped to any 5e1;Ofltles mentioned In thIS or any future Issue, and such posItIon may be d,fferent from ony vIews now or hereafter exprested In thIS or ony other l5ue Janney Montgomery Scott, Inc, which 1 regIstered WIth the SEC as on investment adVIsor, moy gIve adVIce to Its Investment adVISOry and othcl custameTl rndependently of any statements mode on thIS or m any other l5ue. Further ,nformatlon on any seCurIty mentIoned herem IS ovollable on request

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Tabell’s Market Letter – December 31, 1971

Tabell’s Market Letter – December 31, 1971

Tabell's Market Letter - December 31, 1971
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TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON, NEW JERSEY 08540 DIVISION OF MEMBER NEW YORK STOCK EXCHANGE, INC MEMBER AMERICAN STOCI( eXCHANGE – December 31, 1971 For some years now, we have studied the familiar seasonal tendency of the stock market -to stage a year''enct rally,;,-andlChas-15eelnhe custom of this letter e-acnDecemberto–poifit out— some of the conclusions that can be derived from a study of this phenomenon. We have suggest- ed that an exhaustive study of chart patterns since the Dow-Jones Industrial Average first was computed in 1897 indicated that such a rally, however miniscule, invariably had taken place. A number of interes ting facts about the market action of the year end may be noted. (1) – As stated above, an identifiable year-end rally has taken place in every year since 1897. This rally often has been of great magnitude with advances as great as 28 having been recorded. It also, on occasion, has continued with only minor interruptions for as long as six months into the new year. However, on other occasions, it has been of only a few days' dura- tion, reaching a top extremely early. Thus, in 1960, 1962 and, most recently, in 1970, the rally reached a peak in the first week in January. In 1961, 1964 and 1967, it continued into February or March. In 1971, the rally peak was reached in early February. (2) – There has been a persistent tendency for the rally to begin early in years when the market has been up, and late in years when the market has been down. In recent upward years, 1959, 1963 and 1967 are examples, the rally commenced from early December. In 1962, 1966 and 1969, it began late in the year. In 1970, a strong year in the second half, the rally began in late November. 1971 action has been indecisive since, although the year was flat, the rally – also began early. \3)- ThelmpDrtanFthin-go-watchin–ConnctiDn- W1thmarkeCacnonlrt-th-eearly montifs– 01 the new year is the low for the previous December. This low has been broken in forty-three years out of the past seventy-one. However, in twenty-five of these forty-three cases, it was broken in January and February. Since 1937, it has never been broken.later than mid-March, with the single exception of 1965. Thus, if the market is able to hold above its December low for the first 2 1/2 months of the year, chances become good that this low will not be broken. For example, in 1960,1969 and 1970, the December low was broken early in January. In 1961, 1963, 1964 and 1967, and, most recently, 1971, it never was broken. 1965, as noted above, was unusual with the December, 1964 low of 850.19 being broken in June when the Dow reached an intra-day low of 832.74. (4) – In years when the December low has been broken, the subsequent trend has been downward two-thirds of the time. 1960, 1962, 1966 and 1969, of course, are typical cases. Again, 1965 was an exception. 1970, of course, was a down year in the first half. (5) – The magnitude of the rally is an important clue as to the year's market trend. For example, an advance of 10 or more from the December low has been followed by an upward or neutral market in thirty of the thirty-five years that such an advance has occurred. An advance of less than 10 from the December low before an identifiable'correction takes place has been followed by a downward market in twenty-four of the thirty-six years. In 1961, 1963, 1964 and 1971, the year-end rally approximated 10. In 1960, 1962 and 1970; for example, it was less than this figure. — — – – – – – – – – – — (6) – The length of time in which the rally continues into the new year also is important. For example, in eighteen years the rally continued into March or later. In sixteen of these eighteen years the eventual trend was upward. In 1964, the year-end rally continued into March and in 1961, 1963, 1967 and 1971 into February. In the coming year, therefore, the December low of 831.12 is an important point to watch. If the present rally tops out in early January and breaks this low, it would be a strong indication of probable market weakness. A like indication would be failure of the Dow to advance 10, or to approximately 914. On the other hand, if a rally continues into February or March, or reaches above 914, an extension of the upswing might be indicated. Dow-Jones Industrial (300 p.m.) 890.28 S&P (300 p.m.) 101.83 AWTmn ANTHONY W. TAB ELL DELAFIELD, HARVEY, TABELL l No statement or expressIon of opinion or any other 10 buy or sell ony secunty referred to or menhoned maHer herem The motter IS ccmlmned presented b, or IS to be merely for the deemed to be. cooverlenCti of direCTly or indirectly, the svb!C1lber While on Ne offer or believe Ihe the suorlicCeItsatoiofnouorf on offer mforma- han to be reliable W(l In no way represent or guarantee based on hIS OYm'mvE!1/gotIOll and mfonnoltor'l JOJlJley MthoentogcocmurearcyyStehaet'r,eofncno, roosf the statements 0 corporation, mude herem Any and ,Is officers or achon to be token by the subSCriber should be employees, may now have, or may later toke, poSItions or trades in respect 10 any sccunlies mentioned m Ih,s or ony future Issue, thIS or any other Issue Jonney Montgo;nery Scali, Inc, which is regIstered w,th the and SEC such os on pos,hon ma In …eStment y a be dd d…,sor, f erent from any may gl …e od….c vie e to ws 115 Ino..w.eotrmehnetreaodft..e. lrsorey)apnrdesotheInl cu\stomers Independently of any statements mode In thiS or Inany other Issue further InformollOll on anysecunty mentioned hereIn ISavollQble on requesl

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