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
TheStreet Open House

5 Stocks Under $10 With Big Upside Potential

GMX Resources

One final under-$10 stock that's starting to trigger a breakout trade today is GMX Resources (GMXR), a pure-play independent oil and natural gas exploration and production company. This stock has been a big winner for the short-sellers in 2011, with shares off by around 70%.

If you take a look at the chart for GMX Resources, you'll notice that this stock has plunged from its July high near $5.36 to a recent low of $1.15 a share. After printing that low, the stock has started to rebound sharply and is now starting to break out on high volume. At last check, the stock is soaring 19% with over 2.4 million shares traded. That volume is well above its three-month average action of 1.53 million shares.

>>3 Oil Stocks to Buy

Traders should now watch GMXR to sustain a breakout and close above $1.50 to $1.56 on high volume. The volume is already there, so just watch the close today to see if GMXR finishes near its daily highs and above $1.56. This high-volume breakout today bodes well for much higher prices for this stock in the coming days or weeks. The next major breakout levels sit at $1.73 and then its 200-day moving average of $1.98 a share.

You could be a buyer of this stock off any noticeable weakness and simply use a mental stop at around $1.50 in case the breakout fails. One could also just buy strength and get long once $1.73 is taken out to the upside with high-volume. Use a mental stop a few percentage points below that level if you buy off strength. I would then add to any long positions once GMXR moves back above its 200-day at $1.98 with volume. Target a run back towards its next significant overhead resistance level at $2.62 if the buyers continue to step up.

5 of 6

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

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
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

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

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, 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
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,131.97 +100.83 0.59%
S&P 500 1,998.98 +14.85 0.75%
NASDAQ 4,552.7590 +33.8570 0.75%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs