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| 3/04/99 Avon Products (AVP)
Points to watch: Watch Avon over the next few
days for a possible trading opportunity. Avon gapped up 1.3125 on the open Wednesday
and intraday broke through resistance and hit an all time high of 49. Normally when
a stock gaps up and breaks out to a new high it is a signal to go long for a short term
trade. In the case of Avon this is NOT the case yet. The move was a false
breakout, and the stock closed below its open at 46.63. The stock would have to close
below the bottom of the gap at 45.56 for Wednesday's action to mark a top and a reversal.
On the positive side technical indicators remain strong with no major
divergences, and OBV hit a high Wednesday. Watch Avon, and buy only on a move
above 49. Depending on your risk tolerance place a stop between the bottom of the
gap (45.63) and Gann resistance at 47.38.
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