Avon Products Inc. - AVP - close: 21.78 change: +0.66

Stop Loss: 20.20
Target(s): 23.50, 24.40
Current Gain/Loss: unopened
Time Frame: 6 to 8 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
It certainly looks like AVP has found a bottom. Investors bought the dip three times near the $20.25 level last week. They bought the dip again this morning at $21.00. Shares of AVP remain oversold after the terrible sell-off from $29 to almost $20. It looks like the correction is overdone and AVP is poised to bounce. A normal 38.2% retracement would lift AVP to the $23.50 area.

I am suggesting small bullish positions now with a stop loss at $20.20. We only want to launch positions if both AVP and the S&P500 open positive tomorrow. I'm setting our first target at $23.50. We'll set a second target at $24.40.

open small bullish positions if AVP and S&P500 open positive tomorrow.

Suggested Position: buy AVP stock @ open

- or -

buy the SEP $23 call (AVP1117I23) current ask $0.50

Annotated chart:

Entry on August xx at $ xx.xx
Earnings Date 10/27/11 (unconfirmed)
Average Daily Volume = 5.1 million
Listed on August 15, 2011