If you take a look at the chart for Plug Power, you'll see that this stock plunged from its May high of $6.20 to a recent low of $1.35 a share. After hitting that low, the stock has started to rebound and print higher highs and higher lows, which is bullish price action. The stock now sets up for a big breakout if it can manage to clear some past overhead resistance levels.
Market players should watch for a breakout trade to trigger if PLUG can manage to move above $2.36 to $2.63 on high-volume. A sustained move and close above those levels should set this stock up to re-test its 200-day moving average of $3.82, or possibly even higher. Traders should watch for volume to register close to or above its three-month average action of 200,411 shares on any breakout.>>Stocks Rising on Unusual Volume One could be a buyer of this stock off any significant weakness and simply anticipate the breakout. I would use a mental stop just below some near-term support at $2.12 if you buy off weakness. If you prefer to buy strength, than buy the breakout once it takes out $2.36 with strong volume. Use a tight mental stop a few percentage points below $2.36 if you get long off strength. The current short interest as a percentage of the float for PLUG is 7.3%. If we do see that breakout in the coming days or weeks, then look for a solid short-covering rally to materialize since the short interest is decent here.