Octobered?!
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sense’ and emotions, we are on the path of going wrong. . . . As I write, we're halfway through today's session.
BOTH the Industrials and Transports are up over 100 points. This is what I call a powerful confirmation, a twin
breakout with force. The implications are that the market is heading higher.”
While by our method of interpreting Dow Theory we didn’t get the Dow Theory “buy signal” until a few weeks later, it was still a
“buy signal.” And, it reinforced what we have been saying since the March lows. To wit, “we are treating the equity markets as if
we are in a new bull market, but are leaving the final bull market ‘call’ to Dow Theory.” Now as I learned it, once you have a Dow
Theory “buy signal” it stays in force until you get a Dow Theory “sell signal.” For example, the Dow Theory “sell signal” of September
1999 was not reversed until the Dow Theory “buy signal” of June 2003. Similarly, the Dow Theory “sell signal” of November 2007
was not reversed until the recent “buy signal.” So I have to ask the question if – “we follow the Averages blindly (via Dow Theory)
the way a blind man follows his Seeing Eye dog” – how can Dick Russell take the “bull out of the box” without the prerequisite Dow
Theory “sell signal?”
Obviously, we don’t think the bull should be taken out of the box even though we do believe the odds for the first decent correction
since the “lows” are rising. That said, we would be buyers on said correction, believing stocks will be higher by year-end than they
are now. We continue to prefer names with dividend yields like CenturyTel (CTL/$32.62/Outperform) and NTELOS (NTLS/$16.96/
Strong Buy); and would note that NTELOS was added to the Focus List last week. For other yield-oriented ideas we urge you to listen
to one of our Canadian energy analysts, Kristopher Zack, speak on the Canadian Oil & Gas Trust Sector on the International Call of
the Month this Wednesday (October 7th) at 4:15 p.m.
The call for this week: Mark Twain’s quote seems to put the month of October in perspective:
“October. This is one of the peculiarly dangerous months to speculate in stocks. Others are November, December, January,
February, March, April, May, June, July, August, and September.”
And as our technical analyst, Art Huprich, wrote last Friday:
“Finally, relative to today’s employment report, as James DePorre wrote yesterday, ‘the response to that report is going to give us a
good insight into the health of the market. If market players buy a pullback on a bad report or sell strength on good news that will
be an important tipoff. The bulls need to build on good news or buy the dip on bad news. If they don't renew their interest in
buying market weakness, the downside is going to gain momentum quickly.’ I would agree.”
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NTELOS Holdings Raymond James & Associates makes a NASDAQ market in shares of NTLS.
Corp. Raymond James & Associates or one of its affiliates owns more than 1% of the outstanding
shares of NTELOS Holdings Corp..
Raymond James & Associates lead-managed a secondary offering of NTLS shares in March
2007.
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Raymond James Investment Strategy
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