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Avon (AVP): The Great Cyber Hoax

May 15, 2015

And boom goes the dynamite…

Avon (AVP) shareholders got the gift of a lifetime on news that London-based PTG Capital bid $18.75 a share – three times yesterday’s closing price.

The stock soared as high as $8.02 on the news.

Shareholders were thrilled to say the least.

Only problem is the news is a hoax.  Yep, new shareholders are now bag holders it would seem.  Not only did Avon not receive a buyout offer, no one can confirm the existence of PTG Capital so far.

If this is the case and an electronic filing made its way through the SEC site, this could very well be another issue of cyber security issues that needs immediate attention.

With the stock likely to pull back, short the stock at current prices, or buy to open the June 2015 7 put.

Microsoft (MSFT)

May 14, 2015

I worry about analysts.

Deutsche Bank just upgraded Microsoft from a Buy to a Hold with a $55 price target.  They believe a weak PC market is already priced in, and that investor enthusiasm is returning over Azure and Office 365.  I have yet to see or hear any one enthusiastic about a soft PC market, though.

Deutsche also believes the stock reflects discount…. You know, as the stock challenges an all-time high at double top resistance. 

How do I get a job as an overpaid analyst without a clue?

Here’s what aggravates me about the “enthusiasm.”

Intel just announced that it expects the PC market to remain challenging this year with mid-single digit declines in the overall market. 

The only thing I’m enthusiastic about here is how much we can make from MSFT downside.  Not only is MSFT challenging double top resistance points, RSI is pivoting from overbought levels above its 70-line.  Money Flow has already reversed off its highs at 80-line.  And MACD hasn’t been this high in years.

The best way to profit from MSFT is by buying to open the MSFT July 2015 48 put.

Best wishes… Ian

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