This Day On The Street
Continue to site
ADVERTISEMENT
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

Lexicon Pharmaceuticals

One more under-$10 name that looks ready to trigger a big-time breakout trade is Lexicon Pharmaceuticals (LXRX - Get Report). This is a biopharmaceutical company focused on the discovery and development of breakthrough treatments for human disease. This stock is off to a monster start in 2012, with shares up over 110%.

If you take a look at the chart for Lexicon Pharmaceuticals, you'll see that this stock has been uptrending extremely strong since it broke out in June above some past overhead resistance at $2.01 a share. Since triggering that breakout, shares of Lexicon Pharmaceuticals have skyrocketed to a recent high of $2.90 a share. During that uptrend, shares of LXRX have been making higher lows and higher highs, which is bullish technical price action. That move has now pushed this stock within range of triggering a near-term breakout trade.

Traders should now look for long-biased trades in LXRX if it can manage to trigger a near-term breakout trade above some overhead resistance levels at $2.78 to $2.90 with high volume. Look for a sustained move or close above those levels with volume that's near or above its three-month average action of 1,093,060 shares. If we get that action soon, then LXRX could explode north of $3 a share and possibly tag $4 a share rather rapidly.

One could be a buyer of LXRX off weakness to anticipate that breakout, and simply use a stop just below some near-term support at $2.54 to $2.30 a share. If you buy off weakness, then I would add to the position once $2.78 to $2.90 is taken out with volume. You could just also buy off strength and get long once this breaks out over $2.78 to $2.90 a share, and simply use a stop at around $2.54 or a big higher.

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.

RELATED LINKS:



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 Beconequity.com and maintains the website Maddmoney.net, 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
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
ECYT $6.09 -1.30%
GALE $1.39 -4.10%
ISR $1.47 -2.00%
LXRX $1.06 -3.60%
PIP $1.64 1.20%

Markets

DOW 18,037.97 -42.17 -0.23%
S&P 500 2,108.92 -8.77 -0.41%
NASDAQ 5,060.2460 -31.8390 -0.63%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs