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TheStreet Open House

5 Stocks Under $10 Set to Trigger Big Moves

Sirius XM Radio

One under-$10 stock that's getting very close to triggering a breakout trade is Sirius XM Radio (SIRI), which is engaged in broadcasting music, sports, news, talk, entertainment, traffic and weather channels in the U.S. on a subscription fee basis through its two satellite radio systems. During the last six months, this stock is down by around 7%.

If you take a look at the chart for Sirius XM Radio, you'll notice that this stock recently moved back above its 200-day moving average of $1.89 a share with volume. The stock also broke out recently above some past overhead resistance at $1.92 to $1.95 a share with volume.

Traders should now watch SIRI for a near-term breakout trade if this stock can manage to sustain a high-volume move and close above $2.06 a share. Look for volume on a move and close above $2.06 that's near or well above its three-month average action of 53.7 million shares. If we get that action, then this stock should setup to re-test its next significant overhead resistance levels at $2.22 to $2.35 in the near future.

If you're bullish on SIRI, then one could be a buyer off any weakness and simply use a mental stop that's just below its 200-day moving average of $1.89 a share. You could also buy off strength and get long once it closes over $2.06 with volume.

It's worth noting that this stock has a decent short interest since 8% of the tradable float currently sold short by the bears. Since this stock has struggled for months to trade above $1.92 to $1.95 a share, this new found strength could be a precursor to a large short-squeeze in the coming days or weeks.

Sirius shows up on recent lists of 5 Penny Stocks With Plenty of Reward and 10 Top Stocks Under $5 for 2012 Picked by Analysts.

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