This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

5 Stocks Poised for Breakouts

WINDERMERE, Fla. ( Stockpickr) -- U.S. stocks are trading modestly higher today as market bulls added to their gains for the week, following yesterday's move by the European Central Bank to inject liquidity in the European banking system.

The ECB and its partners in the U.S., Britain, Japan and Switzerland opened new lines of credit to European banks, allowing them to borrow dollars for as long as three months. The hope among the bulls on Wall Street is that this move shows that European leaders are serious about containing their sovereign debt crisis. The less optimistic crowd is viewing this action as nothing more than a bandage on massive wound.

Nothing demonstrates the bear view more than this recent Bloomberg report that bearish bets by hedge fund managers at the end of August on S&P 500 index futures increased to the highest level in almost four years.

Related: 5 Stocks Under $10 Setting Up to Trade Higher

The last time bearish bets were that high was in September 2007 before the S&P 500 plunged dramatically. The bears clearly think that Europe is going to be hit with a major debt crisis that could result in a large drop in equity prices around the globe. Some of the bears are even predicting a massive slide in the euro -- if, for example, a debt-laden country such as Greece were to be kicked out of the eurozone.

Those huge bearish bets could end up backfiring on the bears if a crisis never materializes. This will lead to a face-ripping short-covering stock market rally as the bulls flood the market with buy programs to squeeze the bears out of their positions. This is just one scenario you should be considering, so follow the trend, volume and price action in the markets. If you start seeing lots of market leaders roll over like Netflix (NFLX) did this week, then get more defensive.

The top traders in the world know that markets are made up of thousands of stocks and tons of sectors. With so many moving parts, there's always some sector or stock that's acting strong and setting up to break out. Trading breakouts is not a new game on Wall Street; the strategy has been pioneered by legendary traders such as William O'Neal, Stan Weinstein and Nicolas Darvas.

Here's a look at a number of stocks that look poised to break out and trade higher from current levels.
1 of 6

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
ZINC $0.25 -16.67%
CAAS $4.23 0.00%
RPTP $4.68 0.00%
SIMO $39.32 0.00%
VVUS $1.37 0.00%


Chart of I:DJI
DOW 17,651.26 -99.65 -0.56%
S&P 500 2,051.12 -12.25 -0.59%
NASDAQ 4,725.6390 -37.5850 -0.79%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs