Viewing Month: May 1991

Tabell’s Market Letter – May 03, 1991

Tabell’s Market Letter – May 03, 1991

Tabell's Market Letter - May 03, 1991
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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 May 3. 1991 or ith tllow.J1oaround 3000. daily changes which seem. intuitively. unusual. are occurring. Are these changes trilly11lrgEi; – arethey-siinpliaproducCoCtt1e-affiage's higher level TO measure them properly. of course. they must be converted to percentage Changes. In the following table, we have taken each dally percentage change since the Dow was first computed in 1897 and have shown the number of trading days in each year since then that the percentage change of the Dow rell within various ranges between under 1 and over 5. . —-leaf VII H….I. H…I. H…I. H…I. I…H. ttlr HI .1.1.1..H…I HI -H–I- .)..5.1 len HI H…I- 1.-.3.1..H..I..H..I..)..51. IOU m 18 10 1 I 1 d2t 151 II 25 11 5 II 1m m !! a 0 0 0 mlita III II 25 1 0 2 lUi 51 II I 1 2 1100 !II 11 20 2 1 I 30 151 11 21 20 I 2 1m 102 11 51 25 II II jill 91 64 Ii II 15 15 1m III 54 2I I 1161 !II 12 1 0 1 0 1964 251 1 a a a a 1m !Ol 19 10 5 I 2 III! m n 200 1i01 m .2 21 5 2 1 1904 1m mm 51 51 I II 2 2 11 a0 ,110. !4l 51 I 1 0 liDJ Iii .1 II I 1 2 ,1101 m 11 1 a 0 dU m 11 2 1 a a 1110 m 55 11 1 0 I 1911 !IS !I 5 1 0 a lil2 m 11 2 I a a 1111 2H 41 1 1 1 a IU4 111 11 2 2 a 1 HIS III 11 22 5 1 0 IllJ 121 12 41 21 I II liH II! II 21 2 2 2 1m m 51 I a a a 1516 2U 14 II 1 0 a 1111 111 11 20 I I I ul8 lil II 11 12 5 2 1911 2U 55 11 aI 1140 m 11 I 1 4 2 1541 m 19 1 2 a 0 ,,,4u2 m II 211 20 Ia 21 a a 0 ,uU m 1 a60 ,dH m 21 1 I0 .uU !ll II I 2 1 ,LHI W 11 1 0 0 1m m II I a I a ,1m m 15 2 0 0 0 1911 !l! II 0 0 a 0 1911 201 II 2 00 19.1 m 12 0 0 0 0 1Il0 112 51 I 2 I 1 1\11 !l1 14 1 1 a 0 ,1112 !II 21 1 I 0 a 1911 151 19 10 I a 0 1111 III 15 It 2I lil1 1'2 15 15 1 a 0 1111 200 51 2 a a a 1m m 21 1 a 0 0 1111 III 50 5 0 1 0 1111 211 11 2 0 a a 1,16 m II 11 -dll—-r&r'-TfI93 w-r2'..22 I2 m2lin61;-.2II 15G2a0O 0 1110 II) IUI-m II 10 0 1 a —4i-8-0O—4 1111 III j\ I 1 a 0 .m!ll jJ I 1 1 a 1m III 61 II 1 1 I 1119 111 II 12 I 2 a 1920 III 16 21 I 2 a 1m 1122 2U '5 2Jl 51 I 1 ij aa aa ,1m 211 II I 1 0 0 ltH 251 II I 1 0 a dts 211 51 1 1 0 im m 51 I 1 1 0 ,1951 !56 21 a a a I 1152 2.0 11 0 0 a 0 1951 115 15 1 0 a ,lSI 211 11 2 a 0 I ,155 211 10 I a I 1 1151 !II 12 a 0 a 0 1151 !ll 11 I 10 dU !l4 II 1 0 0 0 ,1961 111 51 I 0 a a !!I4 20\ I! I 1 a a IhS m II 1 a a 1981 III 15 I 1 1 0 1111 151 51 21 10 1 I laa 181 19 11 1 1 1 !,inioI 201 10 I lBI 5t 11 I 1 a a 1 0 1111 114 14 2 1 a 0 1151 m 11 1 I 0 a 1m !II i8 I I a 1 11.0 !II 11 1 a a a – —– Briefly. the table reaffirms a conclusion we have iterated in this space. that is. that the market. during the twentieth century. has gone through four different eras in terms of volatility. The first such era lasted from the turn of the century through 1928. It saw. for the most part. over 200 trading days per year with a percentage change of under 1. Except for a few volatile years. the number of large changes during this period was fairly small. and in only six years did the number of changes in the 2 – 3 range exceed 20. The next period. one of highly increased volatility. encompassed 1929 and the 1930's. The ten year period 1929 – 1938 showed eight years when under-l changes numbered fewer than 200. and when 2 – 3 changes were' greater than 20. There were. in 1932, an incredible 35 daily changes of 5 or more. From 1939 until about 1970 there occurred a period during which wide changes were uncommon. The figures for that era speak for themselves. but It is interesting to note there were no fewer than nine years during Which a percentage change of greater than 2 never occurred. 'Finally. 'since 1970. the' number -of wide swings has indeed increased. In 13 of 22 years, changes of under 1 have been fewer than 200. and the number of 1 – 2 changes reached a level a good deal higher than it had been prior to 1970. If anything. in terms of average movement for the Dow, the present period appears much like the early part of this century. This, however, has been true for over 20 years and does not seem to be a phenomenon that has emerged recently. ANTHONY W. TABELL DELAFIELD. HARVEY. TABELL INC. Dow Jones Industrials (1200) S & P 500 (1200) Cumulative Index (5/2/91) 2927.23 379.49 6068.83 AWT jb No slatement or expression 01 opinion or any other maner herein contained IS, or IS to be deemed to be, directly or Indirectly, an oHer or the solicitation of an oHer to buyer sell any security 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 reliable, 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 Investigation and InformatIOn Delafield, Harvey, Tabellinc , as a corporation and Its officers or employees, may now have, or may later take, positions or trades In respect to any securities menboned 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, Tabe!llnc, which IS registered with the SEC as an Investment adVisor, may give adVice to rts Investment adviSOry and other customers Independently of any statements made In thIS or In any other Issue Fur1her lnformahon on any secUrity menlloned herein IS available on request

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Tabell’s Market Letter – May 10, 1991

Tabell’s Market Letter – May 10, 1991

Tabell's Market Letter - May 10, 1991
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TABELL'S MARKET LETTER ,- '. 5 VAUGHN DRIVE, CN 5209, PRINCETON, NEW JERSEY 08543-5209 MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC (609) 987-2300 —— – May10,'1991—– —,- There has been a sUbtle change in the market environment. It is as if the Dow I havIng finally managed to close above 3000 on April 17. decided it deserved a rest. With stocks having moved sideways for- three weeks. the trading range between 2850 and 3000 now assumes Increased Importance, and the ultimate breakout from this range will probably begin a significant move. In whatever directIOn It fmally takes place. Even in the changed market environment. one piece of conventional wisdom remains mtact. It has been universally noted that smaller stocks have been outperforming larger ones. and that this recent spurt contrasts with a long period, ended last fall. when precisely the opposite was true. The OTe Industrial Index. down 32 at its October low, was. at its April peak, up a fairly astonishing 68 from that low. The reaction to this phenomenon has vaned. Optimists have heralded the birth of a new bull market in secondary stocks, and pessImists have seized on the rise as evidence of pernicious speculation which can came to no good end. In the hght of historical evidence it is probable that neither statement is true. RATIO (VALUE LINE / S&P 5GO) VALUE LINE COMPOSITE — The chart above depicts our own favonte measure of small stock action, the ratio of the S & P 500 to the Value Line Composite. which equally weights some 1,100 stocks. The ratio is the upper line plotted above, and the two averages are plotted below it. It IS clear that we have, since 1968 J seen two great bear markets and one long bull market in small stocks. The first bear market began at the 1968 high. when the Value Line Index was at 188. 175 of the S & P 500 at 107. While the S & P was falling 35 in 1968-70, the Value Line plunged 54. The S 81 P moved to 8 new high In 1973 While the Value Line barely achieved a one-third retracement, and that averages drop to it's 1974 low was, likewise. signifIcantly greater than that of the S & P. From that 1974 low. there ensued a nine-year bull market In secondary issues with the Value Line.Index, as the chart shows,Mconsistently doing better than the large-cap index. This ended. however. in June 1983. and the relative performance of the Value Line has been inferior through last fall, when it found itself down 35 from a 1989 peak with the S & P down only 20 from July, 1990. Since then achon has improved, but all that that improvement has produced so far is the tiny blip on the right hand side of the chart. It is interesting to compare thIS with the five years between 1973 and 1978. when the ratio fluctuated back and forth with close to a dozen swings comparable to the recent one. We have nothIng against the argument that the long downswing in the relative action of secondary stocks may be at or close to an end. but it must be noted that fIve years of sideways action were necessary two decades ago before the last smail-stock bull market got under way. ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL INC. Dow Jones Industrials (12 00) 2960.87 S & P 500 (1200) 381.66 Cumulabve Index (5/9/91) 6108.31 AWTjb No statement or expression of opinIOn or any olher maner herein contained IS, or IS to be deemed to be, dlrecllyorlndlrectly, an offer or the soliCllalion Of an offer 10 buy or sell any secunty referred to or mentioned The maner IS presented merety for the convenience of the ubscrlber While we believe the sources of our Informallon 10 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, Tabelllnc, as a corporation and Its officers or employees, may now have, or may laler take, positions or trades In respect to any secUrities menlloned 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, Tabellinc , which IS registered With Ihe SEC as an Investment adVisor, may give adVice 10 'Is Investment adViSOry and other customers Independently 01 any statements made In thiS or In any other issue Further information on any secunly mentioned herein IS available on request

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Tabell’s Market Letter – May 17, 1991

Tabell’s Market Letter – May 17, 1991

Tabell's Market Letter - May 17, 1991
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TABELL'S MARKET LETTER 5 VAUGHN DRIVE. CN 5209, PRINCETON, NEW JERSEY 08543-5209 MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS. INC (609) 987-2300 !– – May 17, 1991 We noted last week that the market had been notably less ebullient smce mid-April, and it . cO.rJtillue to emJtgaye—ribraJi9nsJrr..la!t. w1'lc!ion. Ihe17,,-o'!e9Y drop- of sol!lp!!..q Computer was a typical manifestation of the- sort of thing, absent since last Fall, winch seems to have reemerged.. The ascent of most indicators has moderated signlficantly since early \larch, and most averages have now folded over mto trading ranges. patterns that have emerged for four market indices. .We examine below the pOlnt-and-figure . C I!80 ,'1 ,2 !I;O !EO !\C 5 , 520 sid IID I, I 1110 Iho '0 '0 a mil1to \ 010 !Ij II II 3! 31 !O IS U. 2 22 2C 18 I. The chart at upper left depicts the familiar action of the Dow Jones Industrials. The upside target of the base at A-B was reached at 3000, and an example of the sort of trading range formation which has developed is shown at the right-hand sid of the chart at C-D, with a downside breakout of 2840. If this formation is to be adjudged a top, the most plausible downside target would involve a return to the original support at around 2600. The S & P 500, at upper right, has a similar potentlal top formation at A-B with a downside objective of 342. A breakout below 364 would be necessary to confirm this target. The Dow Jones Transportation Average (at lower left) presents an entirely different and interesting picture. The peak of the base at A-B has been overrun, and current action is normal, the rise having halted in the supply m the upper 1100's. This may constitute the beginmng of a possible top formation similar to that of the broader indices. It could also, were 1200 -to-be hrokendecisively, -be interiireted Qs-a head-and-shou\der-s base, presaging an ultimate move to new highs .. Financial stocks (the S & P Index is at the lower right) are demonstratmg similar actIOn. They have now moved into overhead supply from their original top and have started to form what could be a new top but also could be preparation for a final takeoff from a long-term base. The common thread through all these patterns is uncertainty. Trading ranges are just that, and there is no compelhng suggestion, in our view, of the ultimate direction of the market's breakout from those ranges. It would, we thmk, be advisable to await that breakout before taklng a flrm market slanceO' ANTHONY IV. TABELL DELAFIELD, HARVEY, TABELL INC. Dow Jones Industrials 02 00) 2881.93 S & P 500 02 00) 370.56 Cumulative Index (5/16/91) 6010.39 AWTlb No statement or expression of opinion or any other matter herein contained IS, or IS to be deemed to be, dlrecttyor Indirectly, an offer orthe soliCitation of an offer to buyor sell any secUrity referred to or mentioned The matter IS presented merety for the convenience of the subSCriber While we believe the sources of our mformatlon to be rehable we In no way represent or guarantee the accuracy thereof nor of the statements made herem Any action to be taken by the subSCriber should be based on hiS own investigation and InformallOn Delafield, Harvey, Tabell Inc, as a corporallOn and Its officers or employees, may now have, or may later take, poslbons or trades In respect to any securities mentioned In thiS or any future Issue, and such position may be different from any views now or hereafter expressed m thiS or any other Issue Delafield, Harvey, Tabellinc , which IS registered wl1h the SEC as an Investment adVISor, may give adVice to lIs Investment adVISOry and other customers Independenlly of any statements made In thiS or many olher Issue Further Information on any secUrity mentioned herem IS available on request

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Tabell’s Market Letter – May 24, 1991

Tabell’s Market Letter – May 24, 1991

Tabell's Market Letter - May 24, 1991
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TABELL-S MARKET LETTER 5 VAUGHN DRIVE, eN 5209, PRINCETON, NEW JERSEY 08543-5209 MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS. INC 1609) 987-2300 May 24, 1991 The market did nothing last week to resolve the dilemma wllicll has constituted tile major topic of discussion in recent issues of tllis letter. Most major averages Ilave remained in a trading range for almost three months, since mid-Marcil, tile boundaries for tllis range, in tile case of tile Dow Jones Industrials, being roughly 2850 and 3000. Last week's activity consisted entirely of backing and filling in the lower part of that range, all of this taking place on flat breadth and light volume. Indeed, Tuesday's turnover of 109 million sllares was tile lowest figure for 1991 to date. Tile market's indecision at current levels reflects, it seems to us, the equal plausibility of botll bullisll and bearish arguments. The bears can base their case on the current relatively Iligh level of prices in relation to earnings, dividends, and book value. Tecllnically, they can also point to tile size of tile potential distributional tops that Ilave been built up and to tile apparently now dissipated supply of institutional casll. They can suggest, also, tllat economic signals are at best, mixed. Bulls, however, can note that tile market has seldom, if ever, been wrong in predicting recovery from recession, something it is obviously doing at the moment. (It has often been wrong at predicting recessions, but tllat is another story.) In addition, it can be pointed out tilat the averages posted higlls as recently as five weeks ago, and that those peaks were confirmed by breadtll and momentum. The current impasse may well continue until the case for one or tile other of these arguments becomes more compelling. Some analysts Ilave noted the relative paucity of new highs, pointing out thar, ori April … 17, the day the DJIA penetrated 3000, that only 217 NYSE issues posted sucll peaks. 'It is true tllat this was a figure exceeded many times as the market reached new higlls during tile 1980's, the onset of the 1982 bull market Ilaving produced 653 daily new. highs on October 11 of that year. Recent levels for tllis indicator have been low in comparison to such figures as this. but this is not, it needs to be stressed, a new phenomenon. The peak figure for daily new highs following the 1987 crash was 306, back in August, 1989, and last month's figure is, interestingly, the best since then. In this light, current levels do not appear to be all that low. A more rigorous look at daily new-high statistics confirms that feeling. We have such data going back to the early 1950's, and, of course, over such a long time period, the figures must be adjusted so as to be comparable. The easiest way of doing this is to divide by the number of issues traded. Thus, the 217 new highs on April 17 constitute just over 10 percent of the 2109 issues that traded that day. It needs to be noted that new-high figures have been computed differently in recent years than they had been prior to the mid-1980's. The study can be formallzed a bit further by studying the levels of this new-high percentage at and around instances of the market's scoring new peaks. Such periods can be defined as those periods when the Dow was in the upper decile of its prior one-year range. A peak figure of not much more than 10 percent during such periods was common during the early stages of past bull markets, and the market often tended not to top out until such time as new highs in the averages were accompanied by much lower new-high figures. The market's high in April of 1981, for example, saw new-high numbers topping at 8.23 of issues traded. The — . same essentially 'Was ..-true ..-of Ufe . mll-rk-et . around the 1976 T top' and ..other past market' peaks- -;- during recent decades. It is difficult, in other words, to make a case for the current level of new highs being particularly bearish. We have in these figures, it would seem, yet another manifestation of the market's present uncertainty. Dow Jones Industrials 0200) S & P 500 (1200) Cumulative Index (5/23/91) AWTjb 2914.80 377.34 6021.79 ANTHONY W. TAB ELL DELAFIELD, HARVEY, TABELL INC. No statementor expression of opinion or any other matter herein contained 1, or IS to be deemed to be, directly or Indirectly. an offer orlhe solicrtatlon of an offer to buy or sel! any securrty referred to or mentIOned The maner IS presented merely for the convenience of the subSCriber 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 subscnber should be based on hiS own Investigation and information Delafield, Harvey, Tabelllnc, as a corporation and liS officers or employees, may now have, or may later take, poslhons or trades In respect to any secUrities menllOned In thiS or any future Issue, and such pt'. hon 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 security mentioned herein IS available on request

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Tabell’s Market Letter – May 31, 1991

Tabell’s Market Letter – May 31, 1991

Tabell's Market Letter - May 31, 1991
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TABELL'S MARKET LETTER 5 VAUGHN DRIVE, CN 5209, PRINCETON, NEW JERSEY 08543-5209 MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC 609) 987-2300 – – – – …..'.r– -. .- May 31, 1991 The technician's function is the study of markets, and that study is broad enough, in our view, to include not only price action but also the institutional arrangements of said markets. We could not, therefore, resist giving some thought to the recently announced scheme for extending trading hours on the New York Stock Exchange, now approved in a split decision by the SEC and due to commence on June 13th. To those of us old enough to recall Rube Goldberg the plan possesses a certain whimsical charm, Briefly, it calls for two after-hours sessions. The first of these, from 4 to 5 p.m. simply allows for the electronic placement of orders at the regular-way closing price, these orders to be matched automatically at the end of the session. The second, lasting until 515, will permit the off-floor trading of baskets of stocks comprising at least 15 issues and worth at least 1 million. There are a number of vantage points from which one may consider this particular plunge into the brave new world. It has, for one thing, been noted that the first late session Is totally computerized, bypassing the trading floor and, in the process, the specialist system. These two traditional elements are regarded by many as being synonymous, a contention we have never quite understood. The computer has been around for quite some time now, and, since Its arrival, we can see little justificstion for the traditional preference for trading securities by having grown men stand around in a confined space shouting at one another. Long ago, we were fond of taunting a friend of ours, an NYSE specialist, with the comment that he would, some day be replaced by a machine. His exasperated rejoinder was, How are you going to get a machine to risk money. He had a point. Machines, as every computer – –proCesslonal-.knows,arethe creation-oC-human–beings, and -breadthR!lddeptho.mrktsarethe results of human beings willing to commit capital to those markets. It seems to us, though, that the Issue of sufficient depth and means of trading are totally separate, and we see no reason why a change in one necessarily applies to a change in another. The ostensible reason for the after- hour sessions, of course, had nothing to do with computers. It was billed as a step toward 24-hour trading, such a practice being a part of the internationalization of financial markets, a phenomenon proclaimed, in almost all quarters, as being the wave of the future. Global investing, it seems, has become one of those Wall Street visions which attains the status of revealed religion. Now we are not about to question the basic desirability of the free movement of capital across national borders. We also have no doubt that the trading of U.S. securities in London and Tokyo will Increase as will the use of foreign securities by American money managers. We would, however, hate to see this Increase become an excuse for battles for turf between various trading centers, especially If those conflicts Involve the relaxation of traditional disclosure standards. We think, in other words, that changes in market structure should be considered in light of the basic attributes of truly efficient markets, not the least of which is disclosure, a cornerstone of U.S. securities trading since Edison invented the ticker. We have a special bias toward this attribute since reported trading figures are, it goes without saying, the lifeblood of the technician. For this reason, the reduced disclosure requirements for the basket trading session are, for us, a cause for some concern. After thinking about this, we began to wonder, however, whether basket trading figures should indeed be included in the price action traditionally analyzed by the technician. The technical analyst's goal is, after all. the detection of changes in investor preferene for..,a particular finpni!t..l instrument by studying the priceJlC'!tion of that instrument. The trading of securities in a basket is, in a sense, the admission of no knowledge of, or preference among, the individual components of that basket. To those of us who believe that knowledge, intelligence and hard work are useful components of the investment process, index trading may, in the long run, turn out to provide opportunities for the rational asset manager. ANTHONY W. TABELL DELAFIELD, HARVEY,TABELL INC. Dow Jones Industrials (1200) 3006.93 S & P 500 (1200) 387.22 Cumulative Index (5/30/91) 6148.58 AWTjb No statement or expression 01 opinion or any other matter herein contained 1, or IS to be deemed to be, directly or indirectly, an offeror the solicItatIon of an offer to buy or sell any security referred 10 or mentIoned The matter IS presented merely for the convenience of the ,ubscnber While we believe the sources of our Information to be reliable, we In no way represent or guarantee the accuracy thereof nor oflhe Slatements made herein Any action 10 be taken by Ihe subsCriber should be based on hiS own Investlgallon and Informallon Delafield, Harvey, Tabell Inc , as a corporallOn and Its officers or employees, may now have, or may later take, positions or trades In respect to any secuntles menlloned In thiS 1Jf any future Issue, and such Pl' lion may be different from any views now or hereafter expressed In Ihls or any other Issue Delafield, 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 Ihls or In any other Issue Further information on any security mentIOned herein IS available on request

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