".V 'ir .--i' go - MANCHESTER HERALD. Fri., Aug. tS. HB / . t f , Odd Fellows: DiFazio's task: Rabbi blasts the way if was 13,561 signers Herald writer Word from Wall Street gurus is . page 3 . page 10 . page 6 Mamis tells me that all segments of the market are nature before a robust rally gets under way. Ij: The latest words from Wall Street's leading technical coming together on the downside. In support of this, he One, Bob Ritter of L.PTltothsdilld, Unterberg ’Tow-. bin, says his latest readings ihdicate a drop in the Dow > • gurus — coming as they do amid a topsy-turvy, notes &e following; frightening and at times near panicky stock market en­ • The favorable long-term groups, like the food com­ to perhaps 750-760. And that should end the bear market,. he belelves. vironment — are getting grimmer with each passing Dan Dorfman panies and the retailers, are tired; they’re starting to Manchester, Conn. downtick in the Dow. And even the prospect of a mini­ correct (going down) and should undc^o substantial As Ritter sees it, investors should lake advantage of Sunny today the current market weakness to acciunulate attractive market robound — which a number of pros are predic­ declines. Saturday, Aug. I 4, 1982 ting — isn’t likely to stem the increasing tide of Syndicated • The leading stocks of just a few weeks ago— such as stocks (those with g ^ chart patterns) since “you’re, and Sunday 'never going to find the exact bottom w hich we’re now.,,, pessimism. Columnist General Motors, Bally Mfg., Goodyear and General — See page 2 Single copy 25c From Merrill Lynch technical research chief Bob Dynamics — are breaking down. in the process of making.” "'1 Farrell, probably the single most influential force in the • The stocks that were recently drawing the bargain The consumer sector is his favorite. Here, he likes.* Hrralft technical arena among the big institutionai investors; hunters, like Caterpillar Tractor and Deere, are now J.C. Penney, General Mills, Omnicare, Johnson & John-. "It looks like we’ve seen the top of the summer rally, losing support and could soon,be heading to new lows. son and PepsiCo. Intel and Texas Instruments — two,.;, stocks that he says have excellent long-term chart; that we’re now on the way down and we could see a groups are working. And one by one, the upside stocks “A basic rule is that stocks’that can’t go up must go break in the Dow to the low 700s.” (manely, in the airline, consumer and gambling sec­ down and that’s currently the flavor of the market,” patterns — are also favored. *■ And from technical boss Alan Shaw of Smith Barney, tors) are feding. Oorabine this with the continued says Mamsi. Another technician. Jack Geller of Janney*, Harris Upham & Co: “We no longer see the market l € ' technical deterioration in both the oil and technology AN ANALYSIS of his stock charts indicates that the Montgomery Scott, sees the most recent market decline ; having the muscle to follow through on the upside... and sectors and it becomes evident, Farrell says, bottoming out in the Dow at between 776 and 784. And;* the Dow could well break its ’82 low.” most vulnerable securities are American Express, “we’re getting to where there’s no place to hide.’’ Caterpillar Tractor, Tandy, National Semiconductor from there he sees a substantial rally. Blind since the The major problem, as Farrell sees it, is that there’s THAT ’82 LOW — a Dow reading of just under 789— and Data General. age of 12 — he has a reader and'posts everything ger­ CyNeill says 'Fed' was recorded June 18, and, may in fact, have already not enough fear. “You make bottoms when nobody Mamis is the author of a'recent stock market book mane in Fraile - the 64-year-old Geller believes there’s been broken by the time you read this. wants to own stock and we haven’t yet reached that . called “How To Buy.” “I wish it were ‘How To SeU,’ ” still a fair amount of money to be made on the short side point,” he says. “There’s just too much underlying com­ he quipped; “then I’d really be on target.” in the technolow sector (notably Tand, Scientific Atlan-^ Importantly, Shaw’s sentimeiits reflect a conspicuous placency, too much under-reaction to some of the worst ta and Dlgital^uipm ent). Skip Becker, who runs a Chicago outfit called HPB WM shift from a view held by a number of technical analysts earnings in the postwar decade (such as in the steel in­ Trading Systems, a technical adviser to about two dozen just a few weeks ago that the worst of the bear market dustry) and the record number of bankruptcies.” NO STORY on technical analysis would be complete institutional big^es with some 650 billion of assets, without an update from the self-professed master of the_ decline — a wicked decline in the Dow of over 200 points However, Farrell belelves the market is moving urged his clients to sell on any rallies. The last of four he's clean drops since April of '81 — had just about run its course. toward capitulation (he sees the low 700s coming by late art — Joe “I’m the Greatest” Granville. An ongoing^ major indicators the firm tracks — the volume changes bear ever since he put out his famous sell signal bn Jan. Now, though, deterioration has beset a slew of signifi­ summer or the early fall). And that, he adds,'Should on 100 selected option stocks on the Big B oard- toumed cant technical indicators followed by the fraternity of mark the final bottom. 6, 1981, with the Dow just under 1,005, Granville, it’s man or in his 1978 campaign for sour. And that led Becker to forecast a miniumum drop widely acknowledged, could precipitate a rtiajor market By Mark A. Dupuis chart-watchers. And this has prompted a number of An even lower Dow reading — about 680 — is an­ United Press International lieutenant governor from Carbone in the Dow to 740 — with an outside possiblity that the rally by swinging to the bullish dde. or any state employee acting as an them to downgrade their near-term expectations — with ticipated by the end of next month by Justin Mamis, a Dow could fall to as low as 700 during a given day’s well-regarded technical analyst who’s a consultant to But, alas, not yet. “The massacre has started,” the • HARTFORD - Gov. William intermediary for a contributor. several grudgingly acknowledging that new '82 lows in trading session. the Dow are now a strong possibility. the institutionally oriented brokerage firm of Werthelm flamboyant Investment adviser told me the other day.. O’Neill said Friday he never The governor also noted he asked “My indicators are very bearish and the best I see on “We are going into the sharpest portion of the ’81-’82 prime Among the technical indicators showing deterioration & Co. accepted any campaign donation Chief State’s Attorney Austin J. the upside is 840,” he says. bear market that should take the Dow to under 727 by are (1) the number of advancing issues, vs. the For risk-takers, Becker lists four stocks he regards as checks from state Department of McGuigan to begin the grand jury AT A MEETING this past Aug. 4 just prior to the Labor Day.” He adds that “once we bi-eak 800— which Transportation workers while he probe of the DOT, resulting in decliners, (2) the number of stocks hitting new ’82 highs, market opening, Mamis told Wertheim salesmen to use prime candidates for short selling. They are IBM, vs. those falling to new lows, (3) the number of stock we’ll do inuninently — you won’t see 800 for the balance was Democratic state chairman or several arrests. M WASHINGTON (UPI) - Interest any rally to sell stocks. “When you can make a lot more General Motors, Raytheon and Kodak. of the year.” running for lieutenant governor. O’Neill has said he didn’t think the rates slipped another notch Friday, groups participating in rallies, and (4) the ratio of put money selling short (a bet on lower stock prices) in option activity to call options. A COUPLE OF OTHER technical analysts I spoke Granville reiterates his forecast of a 550-650 Dow — O’Neill maintained his position it DOT investigation would be an issue as major banks quickly followed the what’s supposed to be a rally, the market is clearly to also see further drops in the market — but of a limited with around 622 as his best guess. was traditional for contractors and in this year’s gubernatorial cam­ Federal Reserve Board’s lead, FARRElj, OBSERVES that fewer and fewer stock saying that it doesn’t want to go up,” he asserts. others doing business with the DOT paign because he was the person lowering their prime rate half a to donate to political parties, but who initiated the investigation. point to 14.5 percent in line with a again insisted there was no “quid In addition to Carbone, among the lower discount rate to banks. p in Brief- pro quo” between contributions and others arrested as a result of the The rates generally available to Amid tax fight, goods state contract awards. grand jury probe was former most consumers, four or more O’Neill' was questioned about Transportation Commissioner points above the prime rate, were political contributions after reports Arthur B. Powers, who was charged not expected to decrees^ im­ Joins chamber that a DOT employee claimed to with receiving bribes and other mediately — if at all.