5 Stocks Under $10 Set to Explode Higher
New Gold
One more under-$10 name that's setting up for a breakout play is gold miner New Gold (NGD). This is a gold mining company, engages in the acquisition, exploration, extraction, processing, and reclamation of mineral properties. It primarily explore for gold, silver, and copper deposits. This stock is off to a slow start in 2012, with shares off by around 10.5%.
If you take a look at the chart for New Gold, you'll notice this stock has been downtrending for the past three months, with shares dropping from a high of $12.25 to a recent low of $7.13 a share. During that downtrend, shares of New Gold have consistently made lower highs and lower lows, which is bearish technical price action. That said, the stock has recently started to rebound off that $7.13 low and is now trading within range of triggering a near-term breakout trade.
Traders should now look for long-biased trades in NGD if it can manage to clear some near-term overhead resistance at $8.90 a share, and its 50-day moving average of $9.17 a share with high-volume. Look for a sustained move or close above those levels on volume that's near or well above its three-month average action of 3,281,690 shares. If we get that move soon, then NGD should easily spike higher back towards its 200-day moving average of $10.87 a share or possibly much higher above $12 a share.
To see more hot under-$10 equities, check out the Stocks Under-$10 Setting Up to Explode portfolio on Stockpickr. -- Written by Roberto Pedone in Winderemere, Fla.Follow Stockpickr on Twitter and become a fan on Facebook.
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