WINDERMERE, Fla. ( Stockpickr) -- Trading stocks that trigger major breakouts can lead to massive profits. Once a stock trends to a new high, or takes out a prior overhead resistance point, then it's free to find new buyers and momentum players that can ultimately push the stock significantly higher.
A great example of a successful breakout trade that I highlighted recently was in Amyris (AMRS). Last Friday, I wrote about the potential for a breakout trade for Amyris in my four stocks poised to break out article. I mentioned how AMRS was close to triggering a breakout trade if it took some key near-term overhead resistance levels.
Guess what happened? Shares of Amyris went on to trigger that move, and that move came with monster volume. Now the stock is ripping higher again today and hitting new daily highs as I write this at $4.37 a share. This stock could easily hit its next significant overhead resistance levels at $6 to $6.69 a share before this breakout runs its course. Either way, this breakout has produced a monster move on a stock that trades under $5 a share.Trading breakouts is not a new game on Wall Street. This strategy has been mastered by legendary traders such as William O'Neal, Stan Weinstein and Nicolas Darvas. These pros know that once a stock starts to break out above past resistance levels, and hold above those breakout prices, then it can easily trend significantly higher. >>ACTIVE STOCK TRADERS: Check out Stockpickr's special offer for Real Money, headlined by Jim Cramer, now! With that in mind, here's a look at five stocks that are setting up to break out and trade higher from current levels.