Viewing Month: November 1989

Tabell’s Market Letter – November 03, 1989

Tabell’s Market Letter – November 03, 1989

Tabell's Market Letter - November 03, 1989
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r——————————————————————————————————————– . TABELL'S MARKET LETTER 600 ALEXANDER ROAD, CN 5209, PRINCETON, NEW JERSEY 08543,5209 MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC (609) 987-2300 November 3, 1989 In the uncertain business ,of forecasting the stock market, refreshing elements of certainty ——-occasionally….pl'eSeittthemlv.-es1 t was-;–f6rexarfip1e—-PQssible on Oct-offer '97Urss- than 8month…a- ago. to say that we were still in a major bull market, the Dow on'that day 'having posted a new high in its 60 rise from October 19, 1987. Just four days later, this certainty had evaporated. By that time, the DJIA had retreated almost 8, the largest fall in over a year, with the vast bulk of the decline occurring on the single day, Friday the 13th. The low reached on that day, 2569.26, has turned out to be the low so far. Although uncertainty was introduced with the market retreat, October 9 still remains a reference point. That date, quite simply, will either come to be known as the high of a 1987-1989 bull market or it will not. Our readers are aware that we have taken the latter position We maintain this position at the moment despite obvious changes in the market climate. Breadth has been abysmal since early September, at which point the Transportation Average, recently 22 under its high. began its own mini-bear market. Over the past two months, the inspection of individual stock patterns has revealed an increasing number of uptrends being destroyed. The amount of distribution which has occurred, though. does not yet seem to be of bear-market proportions. and we are, in addition, relying on the historical fact that major tops generally have taken a fairly long time to form. Start Date Jul 31 23 Nov 13 29 Jul 8 32 Mar 31 38 -, r 28 42 Jun 13 49 Sep 14 53 Oct 22 57 Jun 26 62 Oct 7 66 May 26 70 Dec 6 74 Feb 28 78 Aug 12 82 Jul 24 84 Oct 19 87 Start DJlA 86.91 198.69 41.22 98.95 92.92 161.60 255.49 419.79 535.76 744.32 631.16 577.60 742.12 776.92 1086.57 1738.74 High Reached 2 Yrs Later 136.50 294.07 110.74 158.41 14Jt.,9.1 263.13 482.90 678.10 830.99 956.68 971.25 1014.79 907.74 1287.20 1909.03 2791.41 Ultimate High Date 381.17 Sep 3 29 294.07 Apr 7 30 194.40 Mar 10 37 158.41 Nov 12 38 2. 50May29,…A6 293.79 Jan 5 53 521.05 Apr 6 56 734.91 Dec 13 61 985.15 Feb 9 66 985.21 Dec 3 68 1051.70 Jan 11 73 1014.79 Sep 21 76 1024.05 Apr 27 81 1287.20 Nov 29 83 2722.42 Aug 25 87 No. of Months Later 74 – 19 32 – 16 25 19 6 26 19 2 7 -3 14 -8 13 of Move ComEleted 17 100 45 100 40 77 86 82 66 88 81 100 59 100 51 Change From 2 Yr High 179 75 50 12 8 9 20 3 9 13 43 The above table is a simple-minded, yet instructive, illustration. It lists the 15 bull markets which have occurred since the 1920's. with their start date and the Dow level on that date shown in the first two columns. The third column is the crucial one. It shows the highest point which was reached up to the second anniversary of the bull-market start. the peak analogous to the 2791.41 level which was the high point of the period October 19, 1987 – October 19, 1989. The table goes on to show the ultimate high for the bull market and the date on which that high was attained. The point of the exercise is that, in 11 of the 15 cases, that high occurred after the two-year anniversary. as shown in the next column. which gives the number of months lag on the high date. The next two figures show the percentage of the total move that had been completed by each bull market's second anniversary and the percentage advance from the two-year high to the ultimate high. The good news in the table, of course, is that most bull markets tend to keep on advancing well beyond their two-year-high point. The bad news 'is that …… since World War I1at lesst-;-theseTadvances have not tended to be very great.. The last bull market, 1984-1987. is an exception to this rule, having completed only half its ultimate advance in the first two years and, at its peak, having moved 43 above its two-year high. However, all the other bull markets since 1949 completed a major portion of their total rise in the first two years, and in most cases, the upside potential remaining at that time was rather small. Thus 9 while it makes sense at the moment to look for a new high, it would be unrealistic to expect that high to be much above the almost-2800 peak already attained. This sort of scenario appears consistent with individual stock patterns at the moment. ANTHONY W. TAB ELL DELAFIELD, HARVEY, TABELL INC. Dow Jones Industrials (12 00) S & P 500 (1200) Cumulative Index (112/89) AWTebh 2638.11 338.44 4779.15 No statement or expression 01 OpInion or any other matter herein contained IS, or IS to be deemed to be, directly or Indirectly, an offer or the soliCitation of an offer to buy or sell any security referred to or menlloned The matter IS presented merely for the convenience of the subSCriber While we believe the sources of our Information to be reliable, we In no way represent or guarantee the accuracy thereof nor of the statements made herein Any action to be taken by the subscriber should be based on hiS own Investlgallon and Informallon Delafield, Harvey, Tabelilnc , as a corporation and Its officers or employees, may now have, or may later take, positions or trades In respect to any securities mentioned In thiS or any future Issue, and such position may be different from any views nowor hereafter expressed In thiS or any other Issue Detafleld, Harvey, Tabell Inc, which IS registered with the SEC as an Investment adVisor, may give adVice to Its Investment advisory and other customers Independently of any statements made In thiS or In any other Issue Further information on any secUrity mentioned herein IS available on request

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Tabell’s Market Letter – November 03, 1989

Tabell’s Market Letter – November 03, 1989

Tabell's Market Letter - November 03, 1989
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TABELL'S MARKET LETTER 600 ALEXANDER ROAD, CN 5209, PRINCETON, NEW JERSEY 08543-5209 MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALER, INC (609) 987-2300 November 3, 1989 In the uncertain business of forecasting the stock market, refreshing elements of certainty occasionally presenC themserves.It-was. – for example ,- possibleonOctoSef' 9 71ess than a moriffi'a'g-o-,-'-' to Bay that we were still in a major bull market, the Dow on that day having posted a new high in its 60 rise from October 19, 1987. Just four days later, this certainty had evaporated. By that time, the DJIA had retreated alost 8, the largest fall in over a year, with the vast bulk of the decline occurring on the single day, FrIday the 13th. The low reached on that day, 2569.26, has turned out to be the low so far. Although uncertainty was introduced with the market retreat, October 9 still remains a reference point. That date, quite simply, will eIther come to be known as the high of a 1987-1989 bull market or it will not. Our readers are aware that we have taken the latter position. We maintain this position at the moment despite obvious changes in the market climate. Breadth has been abysmal since early September, at which point the Transportation Average, recently 22 under its high. began its own mini-bear market. Over the past two months, the inspection of individual stock patterns has revealed an increasing number of uptrends being destroyed. The amount of distribution which has occurred though, does not yet seem to be of bear-market proportions, and we are, in addition, relying on the historical fact that major tops generally have taken a fairly long time to form. Start Date Jul 31 23 Nov 13 29 Jul 8 32 Mar 31 38 Apr28A2 Jun 13 49 Sep 14 53 Oct 22 57 Jun 26 62 Oct 7 66 May 26 70 Dec 6 74 Feb 28 78 Aug 12 82 Jul 24 84 Oct 19 87 Start DJIA 86.91 198.69 41.22 98.95 9.2.9.2 161.60 255.49 419.79 535.76 744.32 631.16 577.60 742.12 776.92 1086.57 1738.74 High No. of Reached Ultimate Months 2 Yrs Later High Date Later 136.50 381.17 Sep 3 29 74 294.07 294.07 Apr 7 30 – 19 110.74 194.40 Mar 10 37 32 158.41 158.41 Nov 12 38 – 16 L40.9112.50y946 25 263.13 293.79 Jan 5 53 19 482.90 521.05 Apr 6 56 6 678.10 734.91 Dec 13 61 26 830.99 985.15 Feb 9 66 19 956.68 985.21 Dec 3 68 2 971. 25 1051. 70 Jan 11 73 7 1014.79 1014.79 Sep 21 76 – 3 907.74 1024.05 Apr 27 81 14 1287.20 1287.20 Nov 29 83 – 8 1909.03 2722.42 Aug 25 87 13 2791.41 of Move ComEleted 17 100 45 100 40 77 86 82 66 88 81 100 59 100 51 Change From 2 Yr High 179 75 50 12 8 9 20 3 9 13 43 The above table is a simple-minded, yet instructive, illustration. It lists the 15 bull markets which have occurred since the 1920's, with their start date and the Dow level on that date shown in the first two columns. The third column is the crucial one. It shows the highest point which was reached up to the second anniversary of the bull-market start, the peak analogous to the 2791.41 level which was the high point of the period October 19, 1987 – October 19, 1989. The table goes on to show the ultimate high for the bull market and the date on which that high was attained. The point of the exercise is that, in 11 of the 15 cases, that high occurred after the two-year anniversary. as shown in the next column. which gives the number of months lag on the ,high date. The next two figures show the percentage of the total move that had been completed by each bull market's second anniversary and the percentage advance from the two-year high to the ultimate high. The good news in the table, of course, is that most bull markets tend to keep on advancing well beyond their two-year-high point. The badnews'isthat;- since WotldWar II at'least-tneseadv-ances have not tended to be very great. The last bull market, 1984-1987, is an exception to this rule, having completed only half its Ultimate advance in the first two years and. at its peak, having moved 43 above its two-year high. However, all the other bull markets since 1949 completed a major portion of their total rise in the first two years, and in most cases, the upside potential remaining at that time was rather small. Thus, while it makes sense at the moment to look for a new hlgh. it would be unrealistic to expect that high to be much above the almost-2800 peak already attained. This sort of scenario appears consistent with individual stock patterns at the moment. ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL INC. Dow Jones Industrials 02 00) S & P 500 (1200) Cumulative Index 01/2/89) 2638.11 338.44 4779.15 AWTebh No statement or expression of opinion or any other matter herein contained IS, or IS to be deemed to be, directly or indirectly, an offer orthe solicitation of an offer to buy or sell any security referred to or mentioned The matter IS presented merely for the convenience of the subSCriber While we believe the sources of our Information to be reliable, we In no way represent or guarantee the accuracy thereof nor of the statements made herein Any action to be taken by the subscnber should be based on hiS own Investigation and Information Delafield, Harvey, Tabel! Inc., as a corporation and Its officers or employees, may now have, or may later take, POSItionS or trades In respect to any secuntles mentIoned In thIS or any future Issue, and such poSItion may be different from any views now or hereafter expressed In thiS or any other Issue Delafield, Harvey, Tabelllnc , which IS registered With the SEC as an Investment adVisor, may give adVIce to ItS Investment adVISOry and other customers Independently of any statements made In thiS or In any other Issue Further Information on any securrty mentioned herein IS avaIlable on request

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Tabell’s Market Letter – November 10, 1989

Tabell’s Market Letter – November 10, 1989

Tabell's Market Letter - November 10, 1989
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TABELL'S MARKET LETTER 600 ALEXANDER ROAD, eN 5209, PRINCETON, NEW JERSEY 08543-5209 MEMBER NATIONAL ASSOCIATION OF SECURITIES. DEALERS, INC (609) 987-2300 November 10, 1989 I – The,market..staged, JhiS\!'M. aesL ofi!QcJ2-b!'-.l3.,!Q)Yalld!haJ.!est haJl, .t2..cI!,je, be;e;;n;.-…..,,…. successful, albeit not particularly impressive. Last Friday's closing low of 2-596.72-was-well-above – – the 2569.26 level reached earlier in the month. The same kind words cannot be said. however of the Dow Jones Transportation Average which, at Friday's bottom was down over 22 from its peak posted back on September 5. The fact that the Transportation Average high was made in September is not without interest. The Dow Industrials topped temporarily at 2752.09 on September 1 and exceeded that high on October 9 at their all-time closing high of 2791.41. The Transportation Average. by contrast, failed to better its September peak in October. This action produced a phenomenon known to technicians as a Dow theory non-confirma tion;O The Dow Theory, stemming as it does from the writings of Charles Dow around the turn of the century J can be said. in many ways, to be the antecedent to much of today's technical analysis. Dow's recognition that the market could be divided into short, intermediate, and long-term waves was seminal for the later development of trend analysis and. indeed, extended to its logical conclusion, can be called a precursor to the science of chaos, at the leading edge of contemporary mathematics. Since the theory was conceived at a time when railroads constituted a major portion of the American economy, its original proponents insisted that the Rail (now the Transportation) Average confirm moves in the Industrials. The early writers are a bit obscure on the subject of just what a lack of such confirmation might mean, but agree that, at least. it produces uncertainty and may even be downright bearish. We all know. of cour!le. that the latest manifestation of Transportation weakness is a product of the collapse of airline-takeover speculation. For the technician, though. this should be irrelevant to the study of the Average itself, and we therefore decided, this week, to conduct an investlgation of past weak relative action by the Transports. It was obviously necessary to develop a methodology for quantifying weak DJTA action, and, for better or worse, We decided on the following, best – -ilIustratedby-example.–Ten-dtlys-ago;-the'l'ransports—atA-l99.-32, -wePeaW-8-.-m–Gt'–t-heirbullmaket– high of 1532.01. On the same day, the DJIA closed at 2653.28, or 95.05 of its previous high. Subtracting this number from the similar 'statistic for the Transports, produces a figure of -16.77. This is the lowest recent figure. We were able to compute this measure of Transport underachievement back to 1949. Interestingly enough, the current low levels for this number are by no means a record. and the Transportation Average has often shown a great deal worse relative action in the past. The record low for the figure, posted in July 1973, is -28.59. The question at hand is, of course, whether or not low levels of Transportation performance have any significance for the future course of the market. Rather arbitrarily. we defined -10 as being a significantly low measure of underperformance. We found 20 relatively uninterrupted runs of days with a more-than-l0 reading. These runs ranged in length from a single day to 570 trading days, covering over two years from June 1972 to October 1974. The latest instance began when the underachievement percentage dropped below -10 on October 16, and this run has now lasted 20 days. Contrary to what one might believe. low levels of Transport performance have often occurred at major market bottoms. There was, for example, a 10-day run ending at the absolute low of the market in June 1949 and another lasting a full eight months, to the market low in October 1957. Similar instances terminated at the lows of 1970, 1974, and, most recently, August 1982, and July 1984. Obviously, there is difficulty in interpreting relatively long runs. The 1972-1974 case cited above did, indeed, continue approximately through the 1974 low, but it included the entire 1973-1974 bear market. It is difficult in such cases to define the precise point at which one should become bullish. Compounding these dIfficulties, are the many instances where Transport weakness occurred in the vicinity of market tops or, at least, intermediate-term declines. Two such cases occurred in 1956-1957, and two also occurred early in 1968 with a fair lead on the peak for that bull market. Most often, though, the action proved to be a harbinger of intermediate-term weakness rather than of 8 major 'top. – — – — – — – – —- . – – – …. 7- .. This manifestation, at least, is interesting. since our own current market scenario identifies the current poor market action as being part of an intermediate-term correction rather than the start of a bear markeL The historical study shows, at least. that current DJTA underperformance is consistent with such 8 theory. The long record. however, may explain why early Dow theory writers were ambivalent about the meaning of a non-conflrmation. Transport weakness, our recent study shows, is at best an uncertain indicator of future market action. ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL INC. Dow Jones Industrials 02 00) S & P 500 (12 00) Cumulative Index (11/09/89) 2617.01 338.62 4718.35 AWTebh No statement or 8)(preSSIOO of opinion or anyolher malter herein contained IS, or IS to be deemed to be, dlrecllyor Indirectly, an offer Ol'the soliCitation of an offerlo buy or sell any secunty referred to or mentIOned The matter IS presented merely for the convenience of the subscnber While we believe the sources of our Information to be rehable, we In no way represent or guarantee the accuracy thereof nor of the statements made herein Any acllOn to be taken by the subSCriber should be based on hiS own Investlgallon and Information Delafield, Harvey, Tabelllnc, as a corporallon and Its officers or employees, may now have, or may later take, positions or trades In respect to any securities mentioned In thiS or any future Issue, and such posilion may be different from any views now or hereafter expressed In thiS or any other Issue Delafield, Harvey, Tabelllnc , which IS registered With the SEC as an investment adVisor, may give adVice to Its Investment adVISOry and other customers Independently of any statements made In thiS or In any other Issue Further Information on any secunty mentioned herem IS available on request

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Tabell’s Market Letter – November 10, 1989

Tabell’s Market Letter – November 10, 1989

Tabell's Market Letter - November 10, 1989
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—— —— TABELL'S MARKET LETTER 600 ALEXANDER ROAD, CN 5209, PRINCETON, NEW JERSEY 08543-5209 MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC (609) 987-2300 November 10, 1989 7 ThemarkeLstaged ,this wee!. ,a.testofits OcJo\ler 13 low, and that test has, to date, been successful, albeit not particularly impressive. Last' Frida;'''clo.rlngJovi -of-25!J6 72-iThS well iili6v'-' -.,… the 2569.26 level reached earlier in the month. The same kind words cannot be said. however of the Dow Jones Transportation Average which, at Friday's bottom, was down over 22 from its peak posted back on September 5. The fact that the Transportation Average high was made in September is not wlthout interest. The Dow Industrials topped temporarily at 2752.09 on September 1 and exceeded that high on October 9 at their all-time closing high of 2791.41. The Transportation Average, by contrast, failed to better its September peak in October. This action produced a phenomenon known to technicians as a Dow theory non-confirmation. The Dow Theory, stemming as it does from the writings of Charles Dow around the turn of the century, can be said. in many ways. to be the antecedent to much of today's technical analysis. Dow's recognition that the market could be divided into short, intermediate, and long-term waves was seminal for the later development of trend analysis and. indeed, extended to its logical conclusion, can be called a precursor to the science of chaos, at the leading edge of contemporary mathematics. Since the theory was conceived at a time when railroads constituted 8 major portion of the American economy. its original proponents insisted that the Rail (now the Transportation) Average confirm mOVes in the Industrials. The early writers are a bit obscure on the subject of just what a lack of such confirmation might mean. but agree that, at least, it produces uncertainty and may even be downright bearish. We all know. of courBe, that the latest manifestation of Transportation weakness is a product of the collapse of airline-takeover speculation. For the technician, though, this should be irrelevant to the study of the Average itself, and we therefore decided, this week, to conduct an investigation of past weak relative action by the Transports. It was obviously necessary to develop a methodology for quantifying weak DJTA action, and, for better or worse, we decided on the following, best lllffiltrau!11l5y-eXlmllI..,-;–Tendaysrgo;-theTransportsat-h199.32Twere…..t78.28–fAheirbul!mar-ket—t high of 1532.01. On the same day, the DJIA closed at 2653.28, or 95.05 of its previous high. Subtracting this number from the similar statistic for the Transports, produces a figure of 16. 77. This is the lowest recent figure. We were able to compute this measure of Transport underachievement back to 1949. Interestingly enough. the current low levels for this number are by no means a record, and the Transportation Average has often shown a great deal worse relative action in the past. The record low for the figure, posted in July 1973, i8 -28.59. The question at hand' is, of course, whether or not low levels of Transportation performance have any significance for the future course of the market. Rather arbitrarily, we defined -10 as being a significantly low measure of underperformance. We found 20 relatively uninterrupted runs of days with a more-than-l0 reading. These runs ranged in length from a single day to 570 trading days, covering over two years from June 1972 to October 1974. The latest instance began when the underachievement percentage dropped below -10 on October 16, and this run has now lasted 20 days. Contrary to what one might believe, low levels of Transport performance have often occurred at major market bottoms. There was, for example, a 10-day run ending at the absolute low of the market in June 1949 and another lasting a full eight months, to the market low in October 1957. Similar instances terminated at the lows of 1970, 1974, and, most recently, August 1982, and July 1984. Obviously, there is difficulty in interpreting relatively long runs. The 1972-1974 case cited above did, indeed, continue approximately through the 1974 low, but it included the entire 1973-1974 bear market. It is difflcult in such cases to define the precise point at which one should become bullish. Compoun'ding these difficulties, are the many instances where Transport weakness occurred in the vicinity of market tops or, at least, intermediate-term declines. Two such cases occurred in 1956-1957, and two also occurred early in 1968 with a fair lead on the peak for that bull market. Most often, thogh the action provd to. be a harbinger. of intermediate-term weakness rather than of a major top. – — – — — – This manifestation, at least, is interesting, since our own current market scenario identifies the current poor market action as being part of an intermediate-term correction rather than the start of a bear market. The historical study shows, at least, that current DJTA underperformance is consistent with such a theory. The long record. however, may explain why early Dow theory writers were ambivalent about the meaning of a non-confirmation. Transport weakness, our recent study shows, is at best an uncertain indicator of future market action. ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL INC. Dow Jones Industrials (12 00) S & P 500 (12 00) Cumulative Index (11109/89) 2617.01 338.62 4778.35 AWTebh No statement or expression of opinion or any other matter herein contained IS or IS to be deemed to be, directly or Indirectly, an offer orthe solicrtallOn 01 an otler to buy or sell any secunty referred to or mentioned The matter IS presented merely for the convenience of the subscriber While we beheve the sources of our information to be rehable, we In no way represent or guarantee the accuracy thereof nor of the statements made herein Any action to be taken by the subscnber should be based on hiS own investigation and Informallon Delafield Harvey, Tabe!1lnc, as a corporation and ItS officers or employees, may now have, or may later take, posrtlons or trades In respect to any seCUrities mentioned In thiS or any future Issue, and such posrtlon may be different from any views now or hereafter expressed In Ihls or any other Issue Delafield, Harvey, Tabelllnc, which IS registered With Ihe SEC as an Investment adVisor, may give advice to Its Investment adVISOry and other customers Independently of any statements made In thiS or In any other Issue Further Inlormatlon on any security mentioned herem IS available on request

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Tabell’s Market Letter – November 17, 1989

Tabell’s Market Letter – November 17, 1989

Tabell's Market Letter - November 17, 1989
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TABELL'S MARKET LETTER 600 ALEXANDER ROAD, CN 5209, PRINCETON, NEW JERSEY 08543-5209 MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC 16091987-2300 – November 17, 1989 -….,.. – Yesterday con8ti(uJga-,.!!n.niyyoforts f5'r–ll! 8toC m.!'.k.et.9!,-enler16,…!-9811,,, the DJIA was at 2038.58. From that point, it was to embark on an I1–mOlllh upswing which . -. – produced an almost-37 advance without a correction of as much as 5. That happy state of affairs ended on October 9 (or more properly, perhaps, the following Friday the 13th) with an almost-8 correction. A quasi-test of the October 13 low occurred early this month. There can be little doubt that the market climate has deteriorated substantially since early September, when breadth peaked and the Transportation Average started its own private bloodbath. We continue to feel that the decline will be intermediate-term rather than long-term in nature, although this is a forecast we would have to revise were continued evidence of distribution to take place. We think it necessary. in any case. to recognize the possibility of lows below those of October-November. Whether or not such lows occur may be especially significant, snce all this is taking place in November. a month which. for some reason, as we have noted in the past, appears to have predictive value. Action for the month of November itself has been almost precisely normal. In the 92 years since 1891, the Dow has been up 55 times in November and down 37, showing a rise some 60 of the time. This is close to the 57 rising average shown by all one-month periods since the Dow was first constructed. What is interesting, however, is what has happened following the 55 past instances of an upward November. The following table summarizes some, pertinent figures. ALL PERIODS FOLLOWING UP NOVEMBER Avg Ch Avg Ch Pe r iod Length Periods Periods Perlods Periods A1l Following In Months Up Down ————- ——- ——- Up Up Down ——- ——- Up Periods Up November ——– ———– 1 632 481 56.8 37 18 67.3 0.46 0.87 2 638 474 57.4 34 21 61.8 0.95 2.41 ;,- —- 3 4 655 -663 456 59.0 -47-97 35 -3r 20 63.6 1. 56 -r8 – – – 6 72—n- 2.30 -4.-06- 5 686 423 61. 9 39 16 70.9 2.72 5.28 6 675 433 60.9 36 19 65.5 3.33 4.75 7 683 424 61. 7 35 20 63.6 3.93 5.23 8 681 425 61.6 40 15 72.7 4.51 7.20 9 668 437 60.5 39 16 70.9 5.14 9.27 10 674 430 61.1 39 16 70.9 5.78 8.20 11 672 431 60.9 36 19 65.5 6.54 7.62 12 683 419 62.0 35 20 63.6 7.29 8.97 c The table shows the history of all market periods of one to twelve months in length since 1897 and compares it with the 55 periods of like length following an upward November. Taking the first line as an example, of the 1113 one-month periods since 1897, the Dow was up in 632 cases and down in 481, thus showing a rise some 56.8 of the time. In the 55 Decembers following an upward November, however, the average found itself up 37 times and down only 18, rising, therfore, 67.3 of the time. The average percentage change for all 1113 one-month periods was just under one half of 1. For the 55 periods following an up November, the average advance was 0.87. The table may be read in the same way for all periods of lengths from two up to twelve months. A glance through the table will show that the predictive value of November appears to be quite uncanny. For all twelve period-lengths, the market produced a greater percentage of rising periods following an upward November than was the case overall. For example, it rose 70 or more of the time over periods of five. eight, nine or ten months compared with an expectation of around 60. Likewise the average percentage Change following an up November comfortably exceeded the average percentage change for all periods of similar length, no matter what the length of the period in question4 The average -Decem15erJanuary cnarige following an upward November, for example. was 2.41 versus an expected average of under 14 Now none of the above says the market cannot go down after an upward November. and it has indeed done so on numerous occasions4 The past two years, also, have seen up markets following a November decline4 Certainly, there are large numbers of other factors, detailed at length in recent letters, which will go into the formation of a market opinion. Nonetheless, the November record is significant enough to be of interest. ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL INC. AWTebh Dow Jones Industrials 02 00) 2650.00 S & P 500 02 00) 341.64 Cumulative Indel (11/ 16189) 4829.62 No statement or expression of opinion or any other matter heretn contained IS, or IS to be deemed to be,dlrectly or Kldlrectly, an offar or the sohcrta\lon of an offerlo buy or sell any securrty referred to or men\loned The matter IS presented merely for the convenience of the subscriber While we behave the sources of our tnformatlon to be rehallle, we In no way represent or guarantee the accuracy thereof nor of the statements made herem Any acMn to be taken by the subSCriber should be based on hiS own tnvestlgatlon and Information Delafield, Harvey, Tabelllnc, as a corporation and ItS ofltcers or employees, may now have, or may later take, positions or trades In respect to any secunlles mentioned In thiS or any future Issue, and such posillon may be different from any VIews now or hereafter expressed In thiS or any other ISsue Delafield, Harvey, Tabef1 Inc, which IS registered With the SEC as an Investmenf advisor, may gIVe advrce o Its mveSlmenl adVISOry and other customers Independently of any Slatements made In thiS or In any o1her Issue Further Information on any securrty mentioned herein IS available on request

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Tabell’s Market Letter – November 24, 1989

Tabell’s Market Letter – November 24, 1989

Tabell's Market Letter - November 24, 1989
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\ \ TABEo..o..'S MARKET LETTER 600 ALEXANDER ROAD, CN 5209, PRINCETON, NEW JERSEY 08543-5209 MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC (609) 987-2300 November 24, 1989 – – — ma rkpet,.h Thee-fnirs t discussi questio n n g. c in onc this erns – space, whetlie rt-wtohmdaejocrnquwehsiticohn s..currently cufminatea confronting the stock on- octOber f3-'is'/ .,,; I simply An intermediate-term correction or the start of a bear market. The second is whether or not the lows for that rtecline have been seen. Our own opinion has favored the former answer to Question No.1 and a no answer to Question No.2, but a point-and-figure chart for the Dow, reproduced below. lllustrates the uncertainty surroundmg both answer!i. 00 .-I I21foo .- -lY.o Uroli H The first feature worthy of note on the above chart—which shows each lO-point price change in the DJIA for this year—is the rise to a high of 2790 and the subsequent October 13 break to 2530, This is a formation which has become all too typical recently—a false breakout from a trading range in one direction and a reversal right back through that range. This is the sort of thing which tends to make the chartist's life a bit more dIfficult. This having been noted. we can move on to the crucial question of how the chart is to be lnterpreted. Our own contention is that a top was completed between August and mid-October and that Friday, October 13 constituted a downside breakout from that completed top. This view would hold that all of the work done since that time is part of a new formation, not yet complete, rather than the broadening of an ongoing top. That latter interpretation, if it were correct. would lead to a much more bearish market opinion. If our view—the completed-top theory—is to be accepted, the next question centers around the downside target for that top. A polOt-and-figure objective is measured from an up wall or straight-line move to a down wall. That the latter occurred on October 13 is obvious. There are, however, three possible up walls and, thus, three possible counts. The fIrst of these, at A-A', yields a downside target of 2540 which, of course, has already been reAched. The second. at B-B', provides a count to 2460, and the third, the most bearish possible. gives a target of 2390. The existence of these lower targets influences our present uncertainty as to whether the ultimate low for the correction has been reached. Following October 13, the Dow rallied into the overhead supply and then moved somewhat … lower, holding, throughout late October and November to date, between 2580 and 2670. It is this latter formation that remains ambiguous. Given an upside breakout. a count could be taken at 0-0', yielding an upside target of 2750, just under the old high. A downside breakout would simply suggest a continuing drop toward the lower two objectives cited above. Thus, the current dilemma. Point-and-figure analysis, at the present time, yields no hard answers, but it does. we think. provide a view of the background against Which the current market is operating. ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL INC. Dow Jones Industrials (12 00) 2678.54 S & P 500 (12 00) 343.79 Cumulative Index (11/22/89) 4808.74 AWTebh No statement Or expression of oplnton or any other matter herem contained IS, or IS to be deemed to be, directly or Indirectly, an offer or the soliCitation of an offer to buy or sell any secunty referred 10 or menlloned The matter IS presented merely for the convenience of the subSCriber While we behave the sources of our Information to be reliable, we In no way represent or guarantee the accuracy thereof nor althe statements made herein Any achon to be taken by the subscriber should be based on hiS own InvestigatIOn and Information Delafield, Harvey, labelllnc, as a corporal1On and lIs ofhcers or employees, may now have, or may laler lake, poS!ltOns or trades In respect to any securities mentioned In thiS or any future Issue, and such posrtlOn may be different from any views now or hereafter expressed In thiS or any other Issue Delafield, Harvey, Taben Inc, which IS registered wIth the SEC as an Investment adVisor, may give adVice to Its Investment adVisory and other customers Independently of any statements made ,n thiS or In any other Issue Further informatIOn on any security mentioned herein IS available on request

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