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 Under $10 Set to Soar

Kratos Defense & Security Solutions

One more under-$10 stock that traders should keep an eye on is Kratos Defense & Security Solutions (KTOS), a specialized national security company engaged in providing mission critical products, services and solutions for the U.S. national security priorities. This stock has been crushed by the bears in 2011 with shares off by over 50%.

If you take a look at the chart for Kratos Defense & Security Solutions, you'll see that this stock plunged from its August high of $11.09 to a recent low of $4.61 a share. After hitting that low, the stock has started to rebound sharply and the upside volume has been expanding. Two recent up days in December registered volume of 4.2 and 1.0 million shares, which is well above its three-month average action of 407,498 shares.

Market players should now watch KTOS for a breakout trade if the stock can manage to sustain a high-volume move and close above its 50-day moving average of $5.91 and above some near-term overhead resistance at $6.39 a share. Look for volume on any move above those levels that's near or above 407,498 shares. If we get that action, look for this stock to spike big back towards $7 to $8 a share, or possibly much higher.

If you like this stock from the long side, then look to buy it on any weakness with a mental stop just below $5.50 and anticipate the breakout. You can also buy off strength and get long on a close above the 50-day with volume. Use a mental stop just below $5.92 if you get long off strength. I would add to either position once KTOS takes out $7.25 with volume.

The bears are also heavily involved in KTOS since 11.8% of the tradable float is currently sold short. This is a decent short interest for a stock under $10 a share, so watch for a sharp spike higher if that breakout trade triggers soon.

To see more hot under-$10 stocks, check out the Stocks Under-$10 Setting Up To Trade Higher portfolio on Stockpickr.

-- Written by Roberto Pedone in Winderemere, Fla.


Follow Stockpickr on Twitter and become a fan on Facebook.
At the time of publication, author had no positions in stocks mentioned.

Roberto Pedone, based out of Windermere, Fla., is an independent trader who focuses on stocks, options, futures, commodities and currencies. He is also an outside contributor to and maintains the website, which he sold to Blue Wave Advisors in 2008. Roberto studied International Business at The Milwaukee School of Engineering, and he spent a year overseas studying business in Lubeck, Germany.
6 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
GRO $1.01 1.00%
GEVO $0.35 5.42%
KTOS $3.06 -1.92%
TRGT $2.23 10.95%
AAPL $93.99 0.31%


Chart of I:DJI
DOW 15,973.84 +313.66 2.00%
S&P 500 1,864.78 +35.70 1.95%
NASDAQ 4,337.5120 +70.6750 1.66%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs