Tabell’s Market Letter – February 23, 1951
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,,,,- ,,;'u '–'-,;;'X1.-;' pr'\,', Wolston.IIoffmon &- Goodwin (';''–'-,' ';'' -',''''I'''–if; /,i;, NEW YORK 5, N. Y. q';.w-n& -;or PHILADELPHIA 2, PA, LOS ANGELES 13. CALIF. SAN FRANCISCO 4, CALIF. ;I,'I ',L 35 Wall Street DIGSY 4,4141 1420 Walnut Street PENNYPACKER ,,'''' TABELL'S MARKET LETTER 550 Os';,,t,t 265 l!;;oSt,t s 1t 1 f!\ h'Ii e'l' ',.,' /'1; 1';' Last Tuesday's downside penetration of the fourteen-day trading ',,range between 256 and 251 brings up the possibility that a longer term top t;distributional pattern may be in the process of formation. It is too ,,1; ' l ;,.'f'f '','; ,- r Ii,,'early to' be certain that such is the case. So far the decline has held ,, . ;Within the bounds of a normal minor technical correction. However, certain ,-'; pof our volume and supply-demand gauges are showing indications of a de- i; f,,1teriorating technical pattern. When this is added to the fact that the '1 ),Dow-Jones industrial average has reached its long-term objective of 250 ;.- !Eand that many individual issues have also reached their individual upside –', ;'objectives, it seems advisable to exercise extreme caution at this stage ie-I II,', of the market pattern and to watch technical action very closely 0 \1 k As yet the technical background suggests the formation of only ,,relatively minor tops in a few groups. However these tops could easily !,'broaden either on a fUrther rally or at levels somewhat below present i;,, '' .; r;prices. Until such a broadening pattern occurs, downside implications ',-, I', are not clear. It might be interesting to note the normal downside tech- ',. I,;;,nical corrections inherent in the present pattern ;;–C 1;1. The minor trend has been up since the late January low of about i (,240, The advance to the recent high of about 256 was sixteen points 0 A i,,normal one-third to two-thirds correction of this advance would bring the f x l1ri;;T,iauveesrdagaey'bTs ahcleokwintotoefr2m2504e-8d2.i74a85te.. This has approximately been reached at last uptrend dates from the November-December lows of i',J i(il around 221, A one-third to two-thirds correction of the thirty-five point n L;advance would bring the average back to 244-232. While not yet definitely',;; t;;indicated, such a correction is very possible. There is good support at ;, tthe 240-236 level. !' The long-term uptrend dates from the June, 1949 low of 160. A i;; ,, ' ;one-third 1bring the to two-thirds correction of average back to the 224-192 the ninety-six point advance area, The present technical would pattern ;f-, 1. does not yet suggest such a decline 0 The potentia top pattern must Vbroaden considerably before such a correction would be indicated, F The technical patterns of individual groups are quite diverse ';; ,/; ;c,- b-'with some groups appearing much more vulnerable than others, Here is a ' , !t''broad classification I '!cI MOST VULNERABLE LEAST VULNERABLE 't1,- ;,'',I, ; ,,-, ,' Automobile 1;-, Chemicals Airlines Building Materials -/i ,It' P',– aCopper & Le d Investment Cos. Metal Fabricating Mining & Smelting Can Drugs Finance Companies Natural Gas r, Z;,.', '' rt'.,,l' Oils Paper I '- Rails Office Equipment Printing & Publishing Retail Trade , f,I' ,,- c! ,– I,'-' r STeti1es Tires & Rubber Shoes Theatres & Motion Pictures Utilities , ', ( ;, L, The other groups are in an in-between position, l,. r- V,' ,-,;, February 23, 1951 EDMUND W0 TABELL WALSTON, HOFFMAN & GOODWIN , ' Closing Averages . – Dow-Jones Ind. 252.18 Dow-Jones Rails 86.51 t ' i7–/)' This m.morandllm il not to b. construed as on offor or solicitation of offlrs to buy or s,1I any ',curilil' From time to time Waldon, Hoffmlln & Goodwin may hay. an interest In some or ell of the securities mentioned herein. The lorl90in9 mllterial has bien prepared by UI al a matter of information only. 11 IS baUld ;' c;, ; upon Information belilved reliable but not ne(.Stlril., complete, Is not uarant.ed 0/11 accurate or final, and is not intended to foreclose Independent InqUiry J;'i);Z;;S;';'o.-;'!;..rf'';.,i..1!!';!i–;;-z,!.;7E'.1!,'-J!!..J;.Yi..r;;-