Viewing Month: September 1982

Tabell’s Market Letter – September 03, 1982

Tabell’s Market Letter – September 03, 1982

Tabell's Market Letter - September 03, 1982
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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 STOCK EXCHANGE September 3, 1982 L 'h ,'- .f ;,,' ,-th, domoot'oon trom a technical point of view. was that it ;, ,,; ,;'- a-strong likelihood thllt'the '98182 bear market had terminated and a new major upward cycle had begun. In light of recent further strength, it is perhaps worth documenting this assertion. The most dynamic upsIde action during the market's turn was concentrated in the eight-day period ended August 26. In that short space of time. the Dow moved up almost 100 points from its low, for a better-than-12 advance. Advancing stocks for the eight days constituted just under 62 of all issues traded. Average volume for the period was over 109.000.000 shares. representing an increase of 111 over the average volume for the previous eight days. For the time frame 1949 to date. all three figures set, or were close to. recods for any eight-day period. The following table documents the three sta- tistics. eight-day percentage advance. eight-day percentage of advancing stocks and eight-day volume increase. The figures reached a week ago plus the 20 other highest readings in the past are shown for each item. Also shown for the 20 past instances is the percentage change in the Dow six months follow- ing the end of the period in question. DATE ———– AUG !3 198 OCT 15 1974 AF'R 17 1975 JUN 1 1970 JUL 17 1970 JAN 31 1975 uc 'v 0 FEB 3 1975 NOV 2 196 JAN 14 1976 JUN 10 1974 AF'R 24 1978 APR 11 1968 JAN 7 1974 DEC 7 1971 AUG 25 1970 SEF' 26 1973 NOV 20 1980 MAR 7 1975 NOV 15 1955 AF'R 30 1980 DJ!A ; ADVANCE —— 14.66 12.05 10.31 10.16 9.82 9.63 7dO 9.01 8.34 8.6 S.08 7.80 7.73 7.61 7.36 7.30 7.12 7.11 7.08 7.07 7.03 AVERAGE DJ!A 6 MO. LATER —— 23.80 1.93 12.42 14.72 18.16 , 0' 16.17 18.06 8.22 -31.71 2.46 4.96 -9.70 11.31 14.63 . b. 93 -2.36 8.86 1.59 14.04 —— 6.75 DATE ———– JAN 10 1975 AUG 26 1982 JAN 12 1976 JLJL 10 1962 JAN 16 1967 D,C 7 1971 CO , ' v FEB 3 1975 JAN 7 1974 NOV 14 1962 JUN 4 1970 AUG 22 1962 OCT 21 1969 APR 11 1968 AUG 28 1970 OCT 15 1974 JAN 14 1963 p 6 1973 JUL 27 1950 JIJL 17 1970 JUN 15 1967 AVERAGE ;; OF ISSUES ADV'NG —— 62.48 61.96 60.10 59.'38 59.37 58.86 0 7 58.10 57.82 57.77 56.70 56.60 56.57 56.47 55.89 55.79 55.21 55.05 54.83 54.60 54.56 DJ!A 6 MO. LMER —— 32.34 177777 8.75 14.31 5.86 11.31 '16'.'1'7' -9.70 14.89 12.42 10.81 -B.78 4.96 14.76 23.80 4.73 -6.93 16. 9 14.72 -0.10 —— 9.68 DATE ———– AUG 26 1982 JUN 4 1962 JAN 15 1976 APR 11 1968 OCT 25 1962 JUL 3 1950 nH' 0' po JUN 30 1950 SEP 21 1949 AUG 31 1970 FEB 4 1975 APR 25 1978 AUG 25 1971 APR 21 1975 SEF' 1 1970 APR 6 1919 SEP 7 1973 JAN 16 1980 OCT 17 1957 'MAR 30 1949 SEP 19 1950 AVERAGE VOLUIi INCREASE —— 111.15 110.24 109.S 87.62 85.19 78.20 '74.5'5 73.93 73.43 71. 95 70.83 69.14 68.76 67.20 66.36 64.22 63.77 63.23 61. 93 55.71 DJIA 6 MO. LATER —— 9.37 8.72 4.96 25.63 10.88 0.';0 9.21 13.40 15.43 15.53 0.53 0.56 2.70 16.47 .60 -8.61 4.20 1. 88 2.08 12.03 —— 7.69 The upside bias is clear. In almost all cases, a performance comparable to the current one has resulted in an appreciably higher market six months later. As the table quite clearly shows. the end of most previous major bear cycles was, in fact, accompanied by action similar to what we saw during the last two weeks of August. 1982. The 1974 bottom, for example. produced a record-setting eight-day advance on the initial rally, plus subsequent record-setting advances on the early 1975 takeoff. These rallies also showed unusual upside breadth and two instances of above-average volume increase. Similar action was observed at 1970 and mostprevious majornbottoms. 1 – – The only instance in the table where strength remotely comparable to that shown recently resulted in significantly lower prices occurred in 1974. In that case. however, the June rally was accompanied by weak breadth and almost no increase in volume. As we noted last week. the exact shape of the pattern now forming remains unclear and, short- term, the bottoming process mayor may not involve lower prices. We think from a long-term point of view. however. that the recent strength can only be read as having highly bullish implications. AWT It Dow-Jones Industrials (1200 p.m.) S & P Composite (1200 p.m.) Cumulative Index (9/2/82) 925.77 122.74 1208.00 ANTHONY IV. TAB ELL DELAFIELD. HARVEY. TABELL No statement or expre,on of opmlon or any other mat1er herem cantamed IS, or .5 to be dee,,d ta be, directly or ,nd,rectly, On oHer or the ollcltotlo of On oHer to buy or sell ony securIty referred to or menlloned The motter I presented merely for the convenlenCtl of the subscflber While we believe the sources of our Informa tlon to be relloble, we III no way represent or guarantee the accuracy thereof nor of the slatements mude hereIn Any actIon fa be token by the subSCriber should be boed on h,s own investIgatIon Clnd Informat,on Janney Montgomery Scoll, Inc, os a corporotlon, and Its offIcers or cmployees, moy now hove, or may loter lae, positIons or trades In respect to ony SeCUritIes mentioned In thIS or any luturc Issue, and such POSItIOn may be different from any vIews now or hereafter expressed In ti'us or any other Issue Jonney Montgomery Scott, Inc, whICh IS regIstered WIth the SEC os on Investment odvlsor, may gIve odvlCe to Its IIlvestment odvlsory and othe, CVltomers IIldependently of any stctements mode ,n thIS or III any other Issue Further IIllormotlon on any security mentIoned hereIn IS oVOllable on request

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Tabell’s Market Letter – September 10, 1982

Tabell’s Market Letter – September 10, 1982

Tabell's Market Letter - September 10, 1982
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TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON, NEW JERSEY 08540 DIVISION OF MEMBER NEW YORK STOCK EXCHANoe, INC MEMBER AMERICAN STOCK EXCHANGE September 10, 1982 . IS, at b i' ottom, .W ,,!!un.s-Uf-nranrof4.ts-practiioners- a very SImple actIVIty. It consIsts, essent i ally ', , of tr y in gt,o'1'pirioi,nt,;d.,.;',0J,,', patterns of market behavior which, based on the past record, indicate certain probabilities (proba- bilities, remember, not certainties) for future behavior Thus, all of the statistics and verbiage we have been hurling at our readers in the past three editions of this letter can be summarized in one simple sentence — unusual upside activity tends to presage a better market. We think this fact can be amply documented ,and we have attempted to do so, from a number of points of view, ever since the market turned in mid-August. It certainly requires little or no expertise to recognize that upside activity since that time has been, to say the least, unusual. It requires little more than reference to a chart book to recognize that this unusual upside activity took place well into an obvious bear market that began in late 1981-early 1982. It is, further, not a great leap of intellectual effort to identify past similar bear markets, look for signs,during their course of roughly comparable upside activity and to suggest that such action has tended in the past to suggest a market reversal. We have thus reiterated the conclusion that the 1981-1982 bear market effectively ended on August 12, 1982 at 776.92 on the Dow. To many observers, however, the reversal pattern of August, 1982 appears somehow incomp- lete. All the way back to the 1930's, cycle-bull markets have tended to be initiated by explosive bursts to the upside such as the one observed last month. There has also, however, been a tend- ency for that unusual strength to be proJeeded by equally utIusuaI weakness. This, of course, was con- spicuous by its absence this time around, which is why last month's eruption was, at least to some degree, surprising. This raises another point about technicaly , however, a point which hel'ps to explain why we have always found it to be an intensely hallp';'mnO activity. Many aspects of m'lrket iOT',tendto, nn(Qanged over lo,g n' of time. Other ,, tend to chn.e with market ,,. It is of this that p ' tne t, with one of his more difficult tasks. It is, for example, arguable, that the tendency for bear markets to culminate with intense downside pressure is one which has been eroding now for a decade. It is possible to define intense downside actiVity as days on which 70 of issues traded decline or on which the Dow declines by more than 2. During the last two weeks of past cycle bear markets, three such days occured in 1953, four in 1957, six an 1962. and four in 1966. The 1970 bear market saw five such intensive downside days. By contrast. the bear market of 1974. despite the fact that it was the most severe since the 1930's. culminated with only a single day on which the Dow declined more than 2 and with no instances of an unusually high number of declines. Likewise. there took place no such activity during the tail end of the bear market which ended in March. 1978. It is thus less than unprecedented that the biggest daily downside move for the Dow in August was a 1. 58 decline on August 4 and the largest percentage of declining stocks in the two weeks preceding August 12 was 59. We think there is an obvious reason for this changing behavior pattern. and it arises from a change in the nature of the participants in the marketplace. Markets are. of course. a product of the collective action of humans. and another simple reason why technical anaylsis is useful is that humans are subject to emotions and emotional activity tends to repeat itself. In recent years. market activity has come to be dominated more and more by professional investors and less and less by individuals. These professional investors. despite their arguably greater knowledge and skill. remain as subject to emotion as the individual investor who prevailed in the marketplace in the 1930's One emotion which has tended to cause erratic behavior is fear. However. it has been suggested that .in ,the caseof the individual ,investor. the dominant, fear.is fear .0Llosing one's .money. while .in – thn case of the professional, paid to generate excess returns, it is fear of losing one's job. It is this fear of failure to participate on the upside that. in our view, has caused the buying panic to become more and more a feature of market activity over recent years. AWTrs ANTHONY W. TABELL DELAFIELD. HARVEY. TABELL Dow-Jones Industrials (12; 00 p. m.) 912.53 S & P Composite (1200 p.m.) 121.19 Cumulative Index (9/9/82 1230.18 No stalement or expreulon of optrUOn or ony other maHer heleln contained IS, or IS to be deemed to be, directly or indirectly, on offer or the sollcltollon of on offer 10 buy or sell ony secunty referled 10 or mentioned The motter IS presented merely for Ihe convemena; of Ihe subscriber While -He believe the sources of our Informo- hon 10 be reliable, we In no way represent or guarantee Ihe accurocy Ihereof nOf of the stolements mode herein Any action 10 be token by the 5ubcnber should be based on hiS own InveShgohon and InformatiOn Jonney Montgomery Scoll, Inc, as a torporo.on, and lIs offICers or employees, may now have, or may loler toke. pOIIIOnS or trodes In resPect 10 any secuIIHes mentioned In thiS or any future Issue, and such pOSition may be dlfferenl from any views now or hereafter expressed In thiS or any olher Issue Jonney Montgomery Scott, tnc, which IS regIstered With Ihe SEC os an Investment adVisor, may give adVice to lIs Investment adVisory and other customers Independently of any statements mode In Ihls Or In any other ISsue -Funher Informollon on any seCurity mentioned herein IS aVOIlable on request

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Tabell’s Market Letter – September 17, 1982

Tabell’s Market Letter – September 17, 1982

Tabell's Market Letter - September 17, 1982
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TABELL'S MARKET LETTER 909 STATE AOAD, PRINCETON, NEW JERSEy 08540 DIYISION OF MEMBER NEW YORK STOCK EXCHANGE, 'Ne MEMBER AMERICAN STOCK eXCHANGE r– September 17, 1982 tu stock set HaugH Dow had advanced almost 20. The fonowing table shows all first, column shoWlng the low for the move, the second the Ahl,,;.. omvoevre saS.Ince izthe tlie '; high, and the third the high which was reached during the first 24 days of the rally. Th column showing the percentage rise on each rally clearly documents the fact that the recent rise is without parallel unless we refer back to the experience of the 1930's. —-D-a-t-e—- NOV 13 199 , DEC 26 1930 JUN 1931 OCT 5 1931 JAN 5 1932 II JUL 8 1932 MAR 31 1938 APR 8 1939 JUN 10 1940 APR 8 1942 OCT 9 1946 JUN 13 1949 SEP 14 1953 OCT 22 1957 JUN 6 1962 OCT 7 H66 MAY 26 1970 DEC 6 1974 FEB 8 1978 AUG 12 1982 Low ——- 196.69 161.18 121.70 86.48 71.24 41.22 98.95 11.44 111.84 92.92 163.1 161.60 255.49 419.79 535.76 744.32 631.16 577.60 742.12 776.92 PrevIous Hl5ih After HHlh ——- 4 Da'/s ——- 381.17 !63.46 94.07 173.04 194.36 156.93 156.93 109.70 116.79 85.88 A8.78 59.63 194.40 11.00 158.41 132.30 155.92 123.86 138.12 99.72 212.50 175.94 193.16 173.59 293.79 272.80 520.95 734.91 ;! 995d5 8160137 985.21 720.43 1051.70 658.79 1014.79 773.82 1024.05 930.46 Da'.1s UntIl r. 20r. 7- Advance Adv RecoverY —— — —– 32.60 6 35.49 7.36 49 8.92 28.95 18 48.49 26.85 4 32.96 20.55 9 32.14 44.66 15 38.71 2.28 14 23.10 8.94 126 29.38 10.75 74 27.27 7.32 134 15.04 7.86 0 25.96 7.42 118 37.99 6.78 137 45.20 5.86 193 24.31 1 0 39 105 27.96 1/; l . 25.21 14.06 35 17.13 4.27 113 11.63 19.76 24 62.13 There were, during that time, several rallies comparable to or greater than August of this year, and, it must be noted. seven of them, 8S shown by the asterisks, were bear-market rallies, Many of them were even steeper than the current one as indicated by the number of days required for a 20 advance to take place. In all post-war bull markets such a rise, of course. ultimately occurred. but it generally took a great deal longer than in the current instance. What differentiates the present case from the 1930's bear-market rallies is the fact that it has recovered 62 of the loss from the previous high. This is one factor which, in our view. invalidates the bear-market argument and reinforces our contention that a cycle bull market began on August 12. Date of Low A D JUS TED H I G H AFT E R 1 Month 3 Months 6 Months 1 Year 2 Yers .- -, APR 28 IN 845.23 910.62 OCT 9 1946 837.98 849.84 JUN 13 1949 832.88 881.0 SEP 14 1953 813.47 861.34 OCT 22 1957 819.28 832.59 JUN 26 1962 855.97 893.28 OCT 7 1966 845.09 856.82 HAY26–r970- 886 81——936 -.09 – DEC 6 1974 857.09 1024.70 FEB 28 1978 810.11 898.62 963.96 1144.90 1219.23 1776.75 878.70 889.94 920.00 920.00 946.20 1097.98 165.04 141.45 914.79 1069.73 1468.45 1584.16 848.84 1011.17 154.98 1360.12 951.88 1054.18 1205.04 1443.09 915.07 984.39 998.58 1028.36 964.6-6-1170-.40 -1-195.55-1294 .58 1155.06 1186.11 1364.98 1364.98 942.33 950.31 950.31 107.07 If such is the case the above figures may be of interest. They show the adjusted highs reached by each of the previous 10 cycle bull markets for various time periods after their inception. The adjustment is accomplished by indexing the low to the August 12, 1982 low, thus giving a frame of reference as to how far the current market might rally if previous markets were approximated. It should be noted that, in almost all cases. the market had moved to a figure above comparable current levels within six months to a year following the low. Also. in most cases, the final figure for the bull market produced highly significant rises. well above what has been seen so far. No suggestion is intended that the current market will duplicate any of the past upswings, but the possible magnitude is at least of some interest. AWTrs ANTHONY W. TABELL DELAFIELD, HARVEY. TABELL Dow-Jones Industrials (12 00 p. m.) 924.22 S & P Composite (1200 p.m.) 123.30 Cumulative Index (9116182) 1246.20 No .statemont or exprtj!Jlon of opinIon or any otner rnoHer herem wntomcd )5, or IS /0 be deemed to be, directly or InclJrcctly, on offer or Ihe sollCltahOn of an offer to buy or sell any security referred to or mentIOned The mottcr IS presented merely for the Convenience of the subscnber While we believe thc sources of our Informa tlon to be reliable, we In no way represent or guarantee Ihe ot;uroc;y thereof nor of the stotements mude hercln Any oellon to be token by !hc subscriber should be bosed on hl own Invesllgollon cnd Information Janney Montgomery Seoll, Inc, as 0 corporation, and Its offIcers or employee, may now hove, or may loter loke, pos1t1on; or trodes In respect to ony SeCVrllles menhoned In It'1I5 or ony future Issue, and suth position mey be different from any views now Of hereafter expressed In thl or Clny other Issue Janney Montgomery StOll, Inc, which IS registered wllh the SEC as on Investment adVisor, may give adVice 10 lis Investment adVisory and at he. CU5tame ondependently of any statements made jn thlt lr In any other ISsue Further information on ony security menfloned herem IJ aVQllcble on (equel! —

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Tabell’s Market Letter – September 24, 1982

Tabell’s Market Letter – September 24, 1982

Tabell's Market Letter - September 24, 1982
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TABELL'S MARKET LETTER B09 STATE ROAD, PRINCETON. NEW JERSEY 08540 DIVISION OF MEM8EA NEW YORK STOCK EXCHANGE, INC MEMBER AMERICAN STOCI( EXCHA.NGe Septe… mb-er.2-4, 1-982 It is perhaps worthwhile at this stage, some six weeks after the beginning of the 1982-198 bull market, to try to restate what seem to us to be some rather clear implications of technical analysis. We have tried to express these conclusions, admittedly in somewhat disorganized form, in the past five issues of this publication. A summary, therefore, appears in order. We had spent most of the year 1982, through August, trying to suggest that any rational study of the four-year, major-stock-market-cycle pattern, indicated a high degree of probability that the 1980-1982 bear market should terminate sometime before the end of the year. Through mid-August, we readily admit, there was precious little evidence being afforded as to when precisely that event might take place. We could only suggest that, as time moved inexorably on, its likelihood became greater. Then came the deluge. We have been trying to document, for the past five weeks, our con- clusion that the upside explosion of August-September, 1982 signified the actual emergence of the reversal we had spent most of the year aWaiting. We have tried to suggest repeatedly that the sort of upside activity seen since mid-August has been,in the past, characteristic of major market reversals and, by and large, only major market reversals. We have, therefore, reiterated the conclusion that a new bull market effectively began on August 12, 1982. Indeed, in a sense, that prophecy has already come to pass. For the past 40 years of stock market history at least, a 20 filter has been a usable tool for defining bull markets. Since, as of this week, we were already up by more than that amount from the August low, the new bull market is not now a conjecture; it is a matter of record. moment, simply that of trying to define how far the bull market will carry and for how long it will continue. We do not, howevel', regard this problem as being of pressing urgency at this stage. Indeed, it is sufficiently precise at the moment to say nothing more than that, based on the historical record, it is likely to continue a good deal further and a good deal longer. The shortest major-cycle upswing on record since 1942 lasted for 21 months — which time frame carries us into May, 1984. The least dynamic upswing during the same time period irvolved a 32 advance on the Dow, which sort of advance from the August low would still take us appreciably higher than we are today. It should, of course, be noted that we are Citing here the least impressive bull markets of a 15-year period during whiCh a secular flat trading range has generally tended to put a damper on bull markets. As we noted last week, if that secular trading range is over, (and we do not think there is yet any evidence that it either is or is not) a rise equivalent to the typical bull markets of the 1950's and 1960's would take us to around the 1400-1500 territory on the DJIA. For some reason, however, most market commentary that we have seen does not tend to focus on these sorts of numbers. Bemused by the fact that the market has traveled as far and fast as it has, much analysis has centered on the inevitability of some sort of correction. Now we fully agree that such a phenomenon will, at some point, emerge. This is nothing more than another way of saying that markets do not persist in one direction forever, an obvious fact which the investor does not need a technical market letter to ascertain. There, indeed, at the moment, exists a possible short-term top formation on the Dow which can be read to a downside target of approximately 885. It is, further, possible that this top may broaden and indicate a correction of even greater magnitude. It is also, it should be noted, equally possible that the formation will not turn out to be a top at all but simply-. a consolidation prior to -yet another upside.thrust -to somewhere in the upper 900's. Indeed, another characteristic of bull markets during the 1950's and 1960's was that they tended to proceed to their ultimate destination without producing corrections of a magni- tude much greater than 5-7. Under the circumstances, then, excessive concern regarding s correction may be a waste or intellectual energy. In investment management, as in any other field, there exists a proper time for everything. The present, in our view, is a proper time for devoting oneself to the task of maximizing those unusual investment returns available only during major upward cycles. AWT rs ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL Dow-Jones Industrials (1200 p.m.) 921. 08 S & P Composite (1200 p.m.) 123.53 Cumulative Index (9/23/82) 1248.32 No statement or expression of oPrfllan or any other matter here.n contained IS, or IS 10 be deemed to be, dHec;tly or Indirectly, on offer Of Ihe Olltllol\on of On offer to buy Or sell any securrly referred to or mentioned The matter IS presented merely for the ConvenrenCi of the subscrIber Whlle.ne believe the sources of our Informa- lion to be rellcble, we In no way represent or guarantee the accuracy thereof nor of the statements m.lde herem Afly oehon 10 be taken by the subSCriber shOuld be bosed on hiS own investIgation and mformotJon Janney Montgomery Scott, Inc, ell a COrporatIon, and lIS officers or employees, may now hove, or rnoy later toke, POSitions or trades In respect 10 any seCUrities mentioned III Ihls or ony future Issue, and such posilion may be difFerent from lny views now Or hereaher expressed In thiS Of (lny other Issue Jonney Montgomery 50011, Inc, which IS registered With the SEC 05 on Investment adVisor may give adVice to Its Investment odvlS.ory and othel cvstomers Independently of ony slatemenh made In thiS or In any other ISs\Je Further informaTIOn on any se(urlt menTioned herein IS available on request

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