5 Stocks Under $10 Set to Soar

Exide Technologies

One under-$10 name in the electronic instruments and controls complex that looks attractive at current levels is Exide Technologies (XIDE), a provider of stored electrical energy solutions and a manufacturer and supplier of lead-acid batteries for transportation and industrial applications worldwide. This stock is off to a decent start in 2012, with shares up over 18% so far.

This company was hit with some bullish news this morning, after it announced that Pep Boys (PBY) has awarded it with a contract to be the majority supplier for their stores in the U.S. and Puerto Rico. Under this contract, Exide will provide automotive, marine, lawn and garden, and heavy duty commercial batteries to Pep Boys.

If you take a look at the chart for Exide Technologies, you'll see that this stock recently sold off from $3.77 to around $2.50 a share. During that selloff, shares of XIDE were making mostly lower highs and lower lows, which is bearish technical price action. That said, the stock rebounded strong off of that $2.50 low with monster upside volume. That rebound has now pushed XIDE back above both its 200-day and 50-day moving averages, and it's quickly pushing the stock into breakout territory.

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Traders should now look for long-biased trades in XIDE if it can manage to hold a trend above its 200-day moving average at $2.96 a share, and if it can sustain a move or close above some near-term overhead resistance at $3.15 a share with strong upside volume flows. I would consider any upside volume day that registers near or above its three-month average volume of 731,478 shares as bullish. At last check, shares of XIDE have hit an intraday high of $3.18 and volume is around 235,000 shares traded.

Traders can look to buy XIDE off weakness and simply use a stop that sits just below its 200-day moving average of $2.96 a share. One could also go long once XIDE clears $3.15 a share with high volume, and then simply use the same stop, or a tighter stop near today's low of $3.05 a share.

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