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5 Breakout Stocks to Buy on This Bounce

BALTIMORE ( Stockpickr) -- Just a few days after 2012's biggest single-day loss in the S&P 500, Mr. Market decided to about-face and post the biggest single-day gain of the year. All told, the S&P shoved 2.3% higher in Wednesday's session -- that's one heck of a bounce.

And early action in Thursday morning's session indicates that there's more to come...

Surprise rate cuts in China are being given credit for the buying pressure this morning, as the People's Republic seeks to encourage growth amid a slowing economy. Central bank stimulus is getting a whole lot of attention this week in general, from George Soros' comments about what the EU needs to do to fix its problems to speculations about QE3 from the Fed.

But ultimately, the bounce in the broad market looks a whole lot more like a technically driven oversold bounce than anything else. That's why we're focusing on the technicals of five breakout stocks that are set to take advantage of the bounce this week.

Also see: 7 Stocks Ripping Higher on Spiked Volume

If you're new to technical analysis, here's the executive summary:

Technicals are a study of the market itself. Since the market is ultimately the only mechanism that determines a stock's price, technical analysis is a valuable tool even in the roughest of trading conditions. Technical charts are used every day by proprietary trading floors, Wall Street's biggest financial firms, and individual investors to get an edge on the market. And research shows that skilled technical traders can bank gains as much as 90% of the time.

Every week, we take an in-depth look at big names that are telling important technical stories. Here's this week's look at the technicals of five big stocks ready to move higher.

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