Viewing Month: March 1983

Tabell’s Market Letter – March 04, 1983

Tabell’s Market Letter – March 04, 1983

Tabell's Market Letter - March 04, 1983
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TABELL'S MARKET LETTER . I 909 STATE ROAD, PRINCETON. NEW JERSEY 08540 DIVISION OF MEMBER NEW YORK STOCK EXCHANOE, INC MEMBER AMERICAN STOCK eXCHANGE – March 4, 1983 The Dow-Jones Industrial Averages closed Thursday at 1138.06 postmg yet another new all- time high. This maturing, sIx-month old, bull market continues to move ahead o11….-a11 fronts–..1'Jith c. -. . 'nosighificantsigns-o! weaknes'sinighT-The 'maret ,as mElasuredby.the'DJIA-, has to–date' -,—- come a long way from its August 12, 1982 low of 776.92 in a relatively short penod of time. The DJIA has, in the penod of 141 trading days, posted a 47.09 increase. In fact, there has been only one other instance in the post-war experience when an advance of this magnitude has been achieved in the same short period of time without experiencing at least a 10 correction. ThIS period, as we should remember, was December, 1974-July, 1975. The similarities of these two periods are remarkable as well as instructive. As this letter has suggested in the past, the beginning of both periods started long-term cycle bull markets. A closer inspection of the two periods shows a number of sImilarities within these cycle bull markets which should be of interest. The tables below list the short-term percent swings of the two penods under discussion of greater than 8 up and 5 down in the DJIA. The columns are self-explanatory. —O-jel-T-E– 12 0 74 3 17 75 7 75 5 14 75 5 2. 75 7 15 75 Period. from 12J6/74 – 7/15/75 OJ A–V-ER-A-G-E577.60 786.53 742.88 858.73 815.00 BB1.Bl HUMIIER OF DAYS Z–C-H-A–N-GE THIS SWING ———- CUMULATIVE ———- 0.00 36.17 o0. 0 o. -5.55 14 .2 1!5.59 27 109 -5.09 10 11. 8.20 30 151 DATE B 12 82 11 3 82 12 16 82 1 10 B3 1 24 B3 3 J 83 Period. from 6/12/82 – 3/3183 OJ A-V-E-R-A-G-E776.92 1065.49 990.25 1092.35 1030.17 1138.06 HUI1BER OF DAY'S ,.X–C-H-A-N-G-E THIS SWING ———- CUI'IULATIVE ———- 0.00 0 0 37014 5. -7.06 30 B. 10.31 10 10. -5.69 10 11' 10.47 21 141 The following observations were noted from exam1n1ng these similarities. First, the percent- age increase of the entire December ,1974-July, 1975 advance was 52.67. This compares similarly with a percentage increase to date of 47.09 for the August, 1982-March, 1983 period. Second, the total number of trading days needed to complete the December, 1974-July, 1975 advance amounted to 151 days. This is indeed also in line with the current August, 1982-March, 1983 period of 141 trading days. Although slightly less in both magnitude and duration, the August, 1982-March, 1983 period cr.. still equal, or in fact, exceed the December, 1974-July, 1975 period in the next few weeks Third, also of interest is thp similar behavior of these two cycle bull markets at the beginning of each period. During the December, 1974-July, 1975 period the DJIA initially advanced 36.17 before a correction of 5 occurred. This was done m a period of 68 trading days. Remark- ably, the August, 1982-March, 1983 period showed an advance of 37.14 completed within 58 trading days. Fourth, in both cases the major part of the entire advance occurred durIng the early per1od. In other words, durmg the December, 1974-July, 1975 period, 68.67 of the entire advance occurred during the initial phase of the advance. The August, 1982-March, 1983 period recorded an initial advance of 79.9 of the entIre move to date. This we have found to be not un typical behavior for previous cycle bull markets … – – – – ……- What th1S exercise has tried to demonstrate is that the impressive performance of the DJIA to date should not be construed as unusual or unprecedented. It is interesting to note what hap- pened after the December. 1974-July, 1975 advance — an 11 decline was followed by a 30 advance. If we project a similar performance for our current market, n 1300 level on the DJIA 1S not impossible. We still are in a cycle bull market which is making newall-tIme highs. What still remains unresolved is currently identifyIng a new super-cycle bull market. The parts of the puzzle, however, appear to be fitting into place. RJS .rs ROBERT J. SIMPKINS. JR. DELAFIELD, HARVEY. TAB ELL Dow-Jones Industrials (12 00 p. m.) 1133.61 S & P CompOSIte (12.00 p.m.) 152.98 Cumulatlve Index (3/3183) 1726.76 No 'tatement or e;o;prenlon of opinion or ony other morler herein contained IS, or IS to be deemed to be, directly or Indirectly, an offer or the soliCitation of an offer to buy or lell ony security referred to or mentioned The matter IS preented merely for the convenience of the subSCriber While -He believe Ihe sovrce of our Informohon to be reliable, we In no woy represent or guarantee the accuracy Ihereof nor of Ihe stolements mude herein Any action to be laken by the subscriber should be bosed on hl own Inve5tlgotlon and Informotlon Janney Montgomery Scott, Inc, as a corporation, ond Its officers or employees, moy now have, or may loler tae, positions or trode In respect to any securities mentioned In thiS or any future Issue, ond such position moy be different from any views now or hereafter epressed In thiS or any other Issue Jonney Montgomery Scott, Inc, whICh IS registered wllh the SEC os on Investment adVisor, moy give adVice to liS Investment adVisory and othel customers Independently of any statements mode In thiS or In any other Issue Further Informotlon on any security mentioned herein IS available on request

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Tabell’s Market Letter – March 11, 1983

Tabell’s Market Letter – March 11, 1983

Tabell's Market Letter - March 11, 1983
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'.. TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON, NEW JERSEY 08540 DIYISION OF MEMBER NEW YORK STOCK EXCHANOE, INC MEMBER AMERICAN STOCK eXCHANGE March 11, 1983 The most valuable service that can be performed by a technician — if he is reading the signs and portents correctly in the early stages of a bull market — is to allay nervousness. There tends to be a '''eneral feeling among il).ves.tothat,if-metl;i,gins..ril-,..u..isssmeho.wexhibiting-aber-rant- ,… behavior 'and-is 'therefore, vulnerable to immediate reversal.' Most'bf'wliat we' have been' writing in this' space for the past six months has constituted an attempt to suggest, in one way or another, that what has been taking place since August, while it bears its own unique signature as all markets do, is, by and large, perfectly normal. Much of the focus of what we have been discussing has been on length of time — i.e., we have noted that a sharp initial rise, lasting for six months as the present one has, is hardly without prece- dent, and we have reminded our readers that bull-maret cycles tend to persist for a great deal longer than this. Our colleague, Robert Simpkins, in taking over this space last week, zeroed in on the ex- tent of the recent advance, some 47 from the August low, and documented the fact that an increase on this order of magnitude was also a not unusual occurrence. It 1S perhaps useful once again to put this fact into historical perspective. The table below cites some relevant statistics for 13 past major-cycle bull markets, starting in July, 1932. For each bull market the starting date and the percentage decline which preceded it is given, followed by the Dow- Jones Industrial Average at the low, the date of the high, the ultimate peak and the percentage advance. Set in this perspective, the 47 advance from August to date still appears as pretty much of a weak sister. All but three of the bull markets in question have involved rises considerably greater than the current one, and in numerous cases the ultimate advapce has been twice as great as the one so far. Previous Date of Date of Low Decline DJIA Low High DJIA High Advance July. 1932 -89.2 41.22 Mar. 1937 194.40 371.6 Mar. 1938 -49.1 98.95 Nov. 1938 158.41 60.1 Apr. 1942 -41.3 92.92 May 1946 212.50 128.7 Oct. 1946 -23.2 163.12 Jun(L1948 193.16 1&.,-,,–4-1 June 1949 -16.3 161.60' Jan. 1953 c- 293.79 81.8 Sep.1953 -13.0 255.49 Apr. 1956 521.05 103.9- Oct. 1957 -19.4 419.79 Dec. 1961 734.91 75.1 June 1962 -27.1 535.76 Feb. 1966 995.15 85.8 Oct. 1966 -22.1 744.32 Dec. 1968 985.21 32.4 May 1970 -35.9 631.16 Jan. 1973 1051. 70 66.7 Dec. 1974 -45.1 577.60 Sep. 1976 1014.79 75.7 Feb. 1978 -26.9 742.12 Apr. 1981 1024.05 38.0 Aug. 1982 -24.1 776.92 Mar. 1983 1141.74 47.0 Even the three advances that have been smaller than the current one constitute, in their own way, special cases. The October, 1966-December, 1968 rise involved only a 32 markup for the Dow, but it was featured by considerably more dynamic action in a whole host of secondary stocks. The cycle from October, 1946 through June, 1949 was essentially an attenuated one, constituting a base-building period for the series of dynamic advances that fOllowed. Interestingly enough, the February, 1978-August, 1982 cycle has many of the same characteristics, and this is,possibly not coinci'dentally, the third case on record in which the usual bull-market advance was so,,,ewhat subdued. There is much, in other words, to suggest that the present rise will turn out to belong comfortably in the family of previous upswings, posting an eventual rise of somewhere between 60-100. There exists one sense in which current behavior is Significantly different from that of the past two decades, and it is indeed an encouraging one. As noted above, two of the sub-par advances on the list have been in recent cycles, 1966-68 and 1978-81. The two intervening cycles, 1970-1973 and 1974-1976 were more normal in terms of advance, but, as the table shows, they both followed extremely steep cor- rections and thus required a sharp advance to recover the ground lost., By contrast, the 24.1 correction which took place between April, 1981 and-last August,' while UnqUestiona15lyoCcyCle-bear-marlet dimensions, was relatively mild. However, this comparptively tepid swing was followed by what appears, to date, to be a more conventional bull-market advance. The market may well be taking on the charac- teristics, in other words, of the cycles which occurred betwen 1949 and 1966, when mild corrections were followed by highly dynamic bull markets. As was pointed out last week, if this pattern is carried through to its conclusion, it would raise the strong possibility of a super-cycle upswing replacing the fiat super- cyle of 1966-1982. It is time, we think, that this question was explored in some depth, and we intend to do so in future issues of this letter. AWTrs ANTHONY W. TAB ELL DELAFIELD, HARVEY, TAB ELL Dow-Jones Industrials (1200 p.m.) 1119.10 S & P Composite (1200 p.m.) 151. 31 Cumulative Index (3/10/83) 1736.36 No statement or expression of opinion or ony other matter here.n c.onlomcd n, or 1 10 be deemed 10 be, directly or mdHectlr,' on offer or the SQlu.1tollon of on offer to buy or sell ony secuTity referred 10 or mentioned The matter IS presenled merely for Ihe converllenee of Ihe subscriber Wh, e we beheve Ihe sources of our mforma lion to be reliable, we In no way represent or guorantee Ihe occ.urocy thereof nor of Ihe stotements mude herein Any action to be taken by the subscriber should be based on hiS own Invesllgatlon and Informotlon Janney Montgomery Scali, Inc. as a corporation, ond lIs officers or employees, may now hove, or may later toke. posillons or trodes In respect to any seCUrities mentioned In thiS or any future Issue, and such POSITion may be different from ony views now or hereafter eKpressed In this or any olher Issue. Janney MOntgomery Scoll, Inc, which IS registered With the SEC as on Investment adVisor, may give odvfl;e 10 lIs investment odvlsory and other customer, Independently 01 any statements mode In thiS or In al'ly other .ssue Further ,formatlol'l on ol'ly security mel'lllol'led herem Is available on request

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Tabell’s Market Letter – March 18, 1983

Tabell’s Market Letter – March 18, 1983

Tabell's Market Letter - March 18, 1983
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– – –,. TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON, NEW JERSEY OB540 DIVISION OF' MEMBER New YORK STOCK EXCHANGE, INC. MEMBER AMERICAN STOCK eXCHANGE March 18. 1983 A reader of. the business news of the past two weeks might well have gotten the impression that much of it should have appeared under the byline of Scheh 'razade. The financial news seemed to con- –s!srlargely oflOOrtales-of'thTSneiKs-ofAraby meetingin solemn assemblage-in an attlll!fptta-!lxlhe—– —, price of crude oil. Their eventual arrival at a 29 price earlier this week was greeted by the stock market with a predictable yawn. but later weakness. led by oil stocks. wound up being generally attri- buted to a feeling that the set price would not. in fact. hold. Though our own oil-industry expertise is close to nil. we see no reason why it should. This con- clusion need be based on nothing more sophisticated than what we are taught in elementary economics about price setting by cartels. The sine qua non of success in this effort is the ability to set effective production quotas. which is exactly the way it was done in the bad old days when the Texas Railroad Commission filled the OPEC role. It is becoming increasingly obvious that this is beyond OPEC's capabilities. Theoretical production ceilings have been set at a level significantly above current pump- ing levels. Those levels of production are. in turn. estimated to be ahead of current consumption at a time when inventory is widely agreed to be excessive. While world economic recovery will mitigate these factors somewhat. demand will still probably rise sluggishly. As one writer pointed out. the homeowner who has recently installed insulation is not going to rip it out because the price of heating oil has come down. Thus. our skepticism concerning the 29 figure. and our feeling that the reports of the demise of OPEC are not exaggerated. To leave economics and turn to a field which we know something about. however. we doubt that any of the above constitutes part of the most crucial consideration at the present time for investors in oil stocks. True. the earnings prospects for most oil-related companies are cloudy at best. but. on the other hand. the stocks are not overly expensive. and much of the uncertainty regarding those earnings may already be built into price levels. What is more significant. in our view. is the overall technical position of these issues. The table below shows the percentage changes in the S & P 500 plus four oil- related S & P group indicies between five significant market points. the 1976-77 high. the 1978 low, the 1 -1.980..Jrigh..Jhe I 982Jo.w…and..a..J.eCe.nLp1'ice. In the. case o the grOUP indicies monthly averalle,p.rice.s are used. The table covers the highs of the last three maJor market cycles. smce the current pnce IS high to date of the current cycle. Basically. a clear-cut pattern emerges. PERCENTAGE 1976-7 High- '1978 Low- CHANGES1980 High- 1982 Low- S & P 500 r978 Low -19.41 1980 High 61.70 1982 Low -27.11 Date 50.04 Oil Int'l -13.06 105.59 -41.47 17.05 Oil Domestic -19.20 109.12 -49.80 22.67 Oil Well Eqpt. & Svcs. – 9.37 245.27 -61. 71 21. 89 Offshore Drilling – 9.98 302.97 -52.00 12.21 On tJleir decline to tTle 1978 low. ml)st oil issuM outperformed the market and- ..lroppe4. much le.ss than the S & P 500. This was followed by distinctly superior performance on the subsequent rise to the 1980 high. oil stocks by and large showing up as the leaders of that bull market. the last completed major market cycle. On the subsequent decline to the 1982 low, the pattern reversed itself. and oil stocks again led. this time on the downside. dropping by a considerably greater percentage than did the 500. On the present cycle. the pattern continues. with the recovery to date being definitely sub-par compared to the 50 rise in the S & P. The point is that it is normal technical action for relative strength to perSist from one cycle to an- other. Oil stocks generally outperformed the market on the 1976-1978 decline and continued this out performance in the 1978-1980 advance. Likewise. their poor relative action in the 1980-1982 drop has been continued so far in the 1982-198 rising phase. and the normal expectation should be for this to continue for the remainder of that phase. Another way of looking at the same phenomenon is to say that. having undergone a major decline in 1980-1982. it is necessary for oil issues to build a base before they can be considered ready for another major advance. The normal way'irCwhich-such-oagebuilding-isaccomplishedis for a group to sit out the upside phase of the subsequent cycle or. in some cases. more than one subsequent cycle. In other words, present price behavior, which consists of oil issues moving more or less laterally while the rest of the market advances sharply. is perfectly normal and indeed should be -expeted to continllP. The present technical outlook for oil stocks does not involve a great deal of long-term price vulner- ability. Indeed. they probably scored their effective lows last August. although it is highJy possible that these lows might be tested at a future date. The name of the game in a bull market. however. is capital enhancement, and, in this particular bull markft at least, oil and oil-related issues mny turn out to be inferior vehicles for that purpose. AWTrs .. ANTHONY W. TAB ELL DELAFIELD. HARVEY. TABELL Dow-Jones Industrials (1200 p.m.) 1122.00 S & P Composite (1200 p.m.) 150.18 Cumulative Index (3/17/83) 1718.02 No stalement or expression of opinion or any other matter herein contained IS, or IS to be deemed to be, directly or Indlfec1Ir.' an offer or the solicitation of an offer to buy or sell any security referred to or mentioned The matter IS presented merely for the convenienc of the subscriber Wht e we believe the SOluces of our Informa han 10 be reliable, we In no way represent or guarantee the accuracy thereof nor of Ihe slalementr. mude herein Any odlon to be taken by Ihe subscriber should be based on his own IIlVesllgallan and Informollon Janney Monlgomery Scott, Inc, as a corporailon, and 115 officers or employees, may now have, or may later take, pos.Jhons or trades In respect to any senlfltJes. mentioned In thl or any futulI' Issue, and such posilion may be different flom any Views now or hereafter expressed In Ihls or any other Iss\Je Janney Montgomery Scolt, Inc, which IS registered With the SEC as an Investment adVisor, may give adVice to Its Investment advISory and athel ruslamer' Independently of any statements mode In thiS or In any other Issue Further Informallon on any secuflly mentioned herem IS available on request

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Tabell’s Market Letter – March 25, 1983

Tabell’s Market Letter – March 25, 1983

Tabell's Market Letter - March 25, 1983
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.-,! TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON, NEW JERSEY 08!140 DIVISION OF MEMBER NEW YORK STOCK EXCHANGE. INC MEMBER AMERICAN STOCK eXCHANGE March 25. 1983 A,lluther newbuIJ-!llarket.higb h,!s–R,IJ,,1!chJey.ed,,!asti'1tF….l1!1'l'J9nsI.ndus!.r;iala!,d – Transportation Averages. (The S & P 500. at Thursday's close , remained fractionally under its March 7 peak.) This latest ascent took place. for thO! most part, without fanfare, being largely produced by rallies which suddenly emerged on Wednesday afternoon and in the last half-hour of Thursday's trading. Volume increased only moderately, to the 90-million-share level versus the 60- 80 million shares which had been recently typical. All this is as it should be. Under current bull-market conditions. the achievement of new peaks is. indeed, a routine event. It will be when long periods go by without the achievement of new highs that investors should begin worrying. The 50 upswing which the S & P has scored since August can be divided into three phases. The first was a just-under-40 move between August 12 and November 9. This was followed by two rises of roughly 10 magnitude. November 12-January 10 and January 24 to date, each one being preceded by a relatively mild correction. 7 in November and 4.6 in January. Such relatively mild shocks are generally the worst that can be expected during the earlymiddle stages of a major advance. It is normal to expect each successive advancing phase in the series of upswings composing a typical bull market to show less and less dynamism. This has been only partially true in the pres- ent case and, indeed, the present rise. from January to date, has displayed exceptional vigor. This can be demonstrated by the following table based on the action of 1351 individual issues. These issues are divided into deciles based on performance, from the best-acting 10 to the worst- acting 10. The averag'e performance of each of thes-e deciles is then,computed for each of the three rising phases. and this performance-is shown -relative-to the performance of the S -& P 500. For reasons of data availability. the first phase is computed only from September 9. rather than the August 12 low. i. CHANGE i. CH,NGE i. CHflNGE 9/9/82 DECILE llL2L82 RfLrHIVE 10SlIE 11/23/82 .. RELATIVE lOSU 1124/83 – RELATIVE 3L23L83 105&1- 1 58.58 15.!4 37.15 )4.20 10.16 28.38 2 36.45 16.36 21.03 9.61 26.53 15.90 3 29.94 10.82 l'j,J 4.4 19.94 9.87 4 25.43 5 21.19 6.97 3.35 11. 78 9.08 1.23 –1 .. 2 15.33 11.7 el.64 () 6 16.79 -0.40 6.35 -3.69 8.18 -0.5) 1 7 13.03 -3.60 3.80 -,6.00 4.17 –4.59 8 9.22 -6.86 1.06 –8 f 48 ( 51 -7.94 9 3.99 -11.32 -2.56 -11.76 -J 40 -13.3 10 -11. 38 -!4.42 -11.78 -20.10 -19.76 -26.50 S&P 500 17.26 10.42 9.j7 The first phase bf the rise. the figures clearly show. wss by far the most .dynamlC, with even the ninth decile posting a 4 advance, and with the best-acting 10 of all stocks rising, on average, 58 over a two-month period. This works out to a 1400 annualized rate. It is, literally. almost impossible to show a loss during such rare market phases ,which fact is the genesis of the old adage Never confuse brains with bull markets. Predictably. the second phase of the rise from Novem- ber to January was less dynamic;with the best-acting 10'-of aU'stocks risin-g(6nly)37-';'nd'the . worst acting 20 actually posting losses. On the third phase. contrary to expectation however, the performance of the average issue actually improved. The sverage percentage change for the first seven deciles was better than it had been previously, as was the action of those segments relative to the S 1\ P. The one predictable event to emerge was increased selectivity. The losses posted by the worst-scting issues increased sharply. More of this sort of thing should manifest itself as successive intermediate-term upswings are posted. . AWTrs Dow-Jones Industrials (12 00 p. m.) 1148.12 S & P Composite (1200 p.m.) 153.70 Cumulative Index (3/24/83) 1751. 23 ANTHONY W. TAB ELL DELAFIELD, HARVEY, TAB ELL No ,totemen! or expression of opinion or ony other mailer herein contained IS, or 1 to be deemed 10 be, directly or Indirectly, on offer or the oll(llotlon of on offer to buy or sell any security referred to or mentioned The malter IS presenled merely for the convenience of the subSCriber While Ne believe the sources of our Information 10 be reliable, we ,n no way represent or guarantee the occurocy thereof nor of the statements mude herem Any oct Ion to be taken by the subSCriber should be based on hiS own Invelilgollan and Information Janney Montgomery Scali, Inc, as a corporation, and ItI officers or employees, moy now have, or may later take, positions or trades In relpcl to any seCUrities menhoned m Ih,s or any fulure Issue, and such pesltlon may be different from ony views now or hereafter clpressed In thiS or any olher Issue Jonney Montgomery Scoll, Inc, which IS registered Ih thc SEC as on mvestmenl adVisor, moy give adVice to Its ,nvestment adVisory and othel customers Independently of ony stotements mode H\ Ihls or m any other Issue Further Information on any security mentioned herem IS avollable on request

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Tabell’s Market Letter – March 31, 1983

Tabell’s Market Letter – March 31, 1983

Tabell's Market Letter - March 31, 1983
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TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON, NEW JERSEY 08540 DIYISION OF MEMBER NEW YORK STOCK EXCHANOE, INC MEMBER AMEAICAN STOCK EXCHANGE – March 31, 1983 …….,. – —'Wlf'jeiierlillyao notciii'iirlQer -It part -onfur-tiiBK'toTIjiiibble-;-WitlLOUr -collellgues'm-the in8r'Kef'-''''' commentary profession. Indeed, since they are our colleagues, we hope we possess some appreciation of the difficulty of their task. There have; over the years, regularly been forecasters whose market scenario has varied widely from our own, and we have never had intrinsic argument with such forecasters, since there have been numerous occasions when their scenario has been a great deal more accurate than our own. However. we consider ourselves. by profession, market historians. We require, therefore J of any market scenario that it have some grounding in historical reality — real trading as it actually took place, rather than some cloud cuckoo land of the market as the forecaster would like it to be. A case in point is Wall Street's current obsession with the 100-150 point correction. This currently fasionable prediction calls for a decline in the aforementioned range which will constitute nothing more than that — a corr'\Ction —, after which the bull market can happUy proceed on to new highs without anyone's having to worry about it. Such an eventuality is, of course, indeed possible, but whether it is plausible in terms of the real world is something else again, since, in 40 long years of market history, there exist precisely three comparable instances. Let us pursue this a bit further. The high for the Dow, one week ago, was 1145.90. A 100point correction would amount to 8.7, a 150-point correction 13.1. Since April, 1942 there have been 11 recognizable bull markets including the current one. Within those 11 bull markets there have been 49 identifiable corrections of 5 or greater. The table below provides some more detail on these periods. Bull Markets April 1942-May 1946 NO. OF CORRECTIONS Over 5–8.7 8.7–13.1. 13.1 4 1 –0- Stsrt of Correction. Feb. 1946 Months After Market Low 46 Advance BefQl'6 Correction 122 Oct. 1946-June 1948 3 2 0 Feb. 1947 4 .13 June 1949–Jan. 1953 4 0 1 – —'bcSCepTt9. 5179-5D3-eJcul.yT916915-7'—-1…3…..,,li3….,.'1-..0..,……,.SAeupg.t. 11995559;…,..24–'22—-9,162'—1 June 1962-Feb. 1966 2 1 0 May 1965 35 75 Oct. 1966-Dec. 1968 2 1 0 Sept. 1967 11 27 May 1970-Jan. 1973 3 0 1 Dec. 1974-Sept. 1976 4 1 0 July, 1975 7 53 Feb. 1978-April 1981 5 1 2 Nov. 1979 21 21 Aug. 1982- 200 33 IT. '5 The table shows, for each bull market, the number of corrections broken down into three cate- gories, those between 5 and 8.7, those in the 8.7-13.1 range (the equivalent of 100-150 points today), and those greater than 13.1. 33 of the 49 corrections, some two-thirds, were less than 8.7 in magni- tude. Five exceeded 13.1. There were;lndeed, 11 cases, one correction in five, which fell within the range in question. Thus, a 100-150 point drop would appear, at least, semi-plausible until we examine the figures further. As the table shows, at lest one such correction did occur in 8 of 11 bull markets. For those eight cases, the right-hand three columns show the date on which the fhmt such correction'stsrtea, the months which the market had advanced when the correction began, and the percentage by which the market had advanced on the correction start date. The current market has advanced by some 50 over seven months. There are only two cases of a correction of this scale occurring within seven months of the low. They tend, quite obviously, to occur much later. Likewise, there are only three cases of an B. 7–13.1 correction having occured before the market had advanced further than the present one already has. A correction of the magnitude in question, in other words, quite clearly tends to occur at a much more advanced stage of the typical bull-market-cycle than the one in which we now find ourselves. A 100-150 point correction occurring today would have only three past precedents, February, 1947, September, 1967, and November, 1979. , It is out of this historical framework that we have evolved our own scenario which recognizes the fact that bull-market corrections tend to start out by being small (The two we have had in this market SO far have been around 6.) and gradually to increase as the bull market approaches maturity. Most of the corrections in the above table of greater than 13.1 have been at the tail ends of bull markets, also. Our own view, therefore, is that (a) a correction of greater than, say 6 (60-70 points) is unlikely to occur over the near term and that (b) were such an event to take place, It would be mUdly discouraging rather than constituting a healthy sign. AWTrs ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL Dow-Jones Industrials (1200 p.m.) 1144.87 SloP Composite (1200 p.m.) 154.49 Cumulative Index (3/30/83) 1748.72 No statement or expression of opmlon or any other matter herein contained IS, or IS 10 be deemed 10 be, dlr(ctly or indirectly, on offer or the ollcltallon of on offer to bvy or sell any seclrIly referred to or menlroned The molter is presented merely for the convenience of Ihe svbscnber While we believe the sources of ovr Informo lion to be reliable, we in no way represent or guarantee the accuracy Ihereof nor of the slatement mode herem Any action 10 be token by the vbscnber should be based on hiS own InveSllgatlon and mformalron Janney Monlgomery Stott, Inc, as a corporation, and Its officers or employees, moy now hove, or may loler loke, positions or trodes In respect to any secvnhes mentioned In Ihls or any fulvle Issue, and svch position may be dlfferenl from any views now or hereafter expressed In Ihls or any other Issue Janney Montgomery Stoll, Inc, which IS reglslered w.th Ihe SEC os on ,nveslmenl adVisor, may give odvlce to 11 tnveslmenl adVISOry and other customers mdependently of any statemenls mode In thiS or In ony olher Issue Further Informollon on any sewrtly mentioned herein IS available on request

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