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Stocks Under $10 with 50-100% upside potential - 14 days FREE!

5 Stocks Poised for Breakouts

WINDERMERE, Fla. (Stockpickr) -- Trading stocks that trigger major breakouts can lead to massive profits. Once a stock trends to a new high, or takes out a prior overhead resistance point, then it's free to find new buyers and momentum players that can ultimately push the stock significantly higher.

One example of a successful breakout trade I recently flagged was Cadence Pharmaceuticals (CADX), which I featured in March 21's "5 Stocks Under $10 Triggering Breakouts" at around $5.70 a share. I mentioned in that piece that CADX was starting to explode right off its 50-day moving average with strong upside volume. That move was starting to push shares of CADX back above some important near-term overhead resistance levels at $5.46 to $5.66 a share. I highlighted how the breakout for CADX was under way and suggested market players look for long-biased trades as long as the move was sustained.

>>Trade These 5 Huge Stocks for Gains

Guess what happened? Shares of CADX never looked back from my flag and the stock has now soared to its intraday high of $7.01 a share. The upside volume for CADX was expanding dramatically as the stock broke out and trended above $5.75 a share, which was a bullish technical signal. Shares of CADX are breaking out again today above some near-term overhead resistance at $6.85 despite a weak overall market. This stock continues to look higher, and if it can sustain this move above $6.85, it could be on its way toward $8 a share.

Breakout candidates are something that I tweet about on a daily basis. I frequently tweet out high-probability setups, breakout plays and stocks that are acting technically bullish. These are the stocks that often go on to make monster moves to the upside. What's great about breakout trading is that you focus on trend, price and volume. You don't have to concern yourself with anything else. The charts do all the talking.

>>5 Stocks With Big Insider Buying

Trading breakouts is not a new game on Wall Street. This strategy has been mastered by legendary traders such as William O'Neal, Stan Weinstein and Nicolas Darvas. These pros know that once a stock starts to break out above past resistance levels, and hold above those breakout prices, then it can easily trend significantly higher.

With that in mind, here's a look at five stocks that are setting up to break out and trade higher from current levels.

>>5 Stocks Under $10 Set to Soar

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