View Text Version (OCR)
Technical Market Action , The arket continues to act in accorance with normal technical procedure. This letter has ceen expecting strong resistance to the decline at slihUy above the September highs of 180-179. The current correction reached a 10\7 of 179.93 on Thursday, October 30th and rallied be,ck to 183.57 on Wednesday, NoveJ11bcr 5th. The dip of the plst fev; days has been on sharply reduced volutle crlQ succeeded in reaching a low of only 180.61. Atility to penetrate h.st we8k's hibh of 183.57 vlOuld be cmstruotive and indicate a nearby testing of the July highs. Mon;ay's market was encouraging, particularly in individual issues. This action, coupled with the ability to hold abo the Octocer 30th 10\7, strengthens our correction that the next move will be toward hiGher levels and a nearby penetration of the 1947 hiehs. However, in this tlarket one can be correct in diar.nosing the moves of the averages but still realize only mediocre price appreciation unless the right stocks are selected. Seldom has such extreme selectivity been witnessed. As mentioned in a recent 18tter, the technical patterns of individual issues show extreosly diverse patterns. A ;;rGat many issues, probably 50, have built up tremendous base patterns and h!ive either broken out of thse ranges on the upside or seem on the verge of so doing. iillother group, possibly 40 of the market, requires sor.te further backin,; t'nd filling cefors the pattern is ,complete and the nnge penetrated on the upside. A third group, probably less than 10, have formed little or no hase patterns and still indicate lower levels. We have tried,in our recom!Jended list of issues, to select the stocks in the first group. The tlajority of recommendations have recently reached new high territory. A fevi h&ve betn disappointing hut the list has been above averag-e. Three issues, Phelps Dodge, Rayonier nnd Sharon Steel, reached or bettered the year's hibhs. list. For purchase at this point, suggest the following from our recommended Alleghany, pfd. Atlas Corporation Celotex Colorndo Fuel General Cable Cities Ser,!ice Chrysler Doehler Jarvis Sharon Steel Youni.istovm Sheet & Tube Ohio Oil Wheeline Steel U.S. & Foreibn Securities Worthington Pump November 10, 1947 EDMUND W. TABELL SHIELDS & COMPANY Closings Dow-Jones Industrials Dow-Jones Rails Dow-Jones 65-Stock 182.21 47.59 64.25 Th. opinions expressed in this letter are the personal interpretation of charts by Mr. Edmund W. labell and .r. not presented a. the opinions of Shields & Company.