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 Higher

TearLab

One more under-$10 stock that's trading within range of a near-term breakout trade is TearLab (TEAR - Get Report), an in-vitro diagnostic company engaged in commercializing a proprietary tear testing platform that enables eye care practitioners to test for highly sensitive and specific biomarkers using nanoliters of tear film. This stock has been skyrocketing so far in 2012, with shares up over 210%.

On Wednesday, Canaccord Genuity imitated coverage on this stock with a buy rating and a price target of $6 per share. That upgrade spark a solid rally for TearLab after the stock closed up 8.6% on heavy volume.

If you take a look at the chart for TearLab, you'll notice that this stock is trending within a range for the past two months, with shares moving between $3.00 on the downside and $3.80 on the upside. Shares of TEAR have just started to recapture its 50-day moving average of $3.35 a share with heavy upside volume, and its quickly moving within range of triggering a near-term breakout trade.

Traders should now look for long-biased trades in TEAR once it manages to break out above some near-term overhead resistance levels at $3.66 to 3.80 a share with high volume. Look for a sustained move or close above those levels with volume that registers near or above its three-month average action of 91,080 shares. If that breakout hits soon, then TEAR will have a great chance of re-testing or possibly taking out its next major overhead resistance levels at $4.35 to $4.88 a share.

Traders can look to buy TEAR off weakness and simply anticipate that breakout, with a stop below its 50-day at $3.35 or down near $3 a share. One could also get long off strength TEAR clears $3.66 to $3.80 with high volume, and then simply use a stock near its 50-day at $3.35 a share.

Keep in mind that TEAR is a favorite target of the shorts, since its current short interest as a percentage of its float is 7.5%. Any breakout over $3.66 to $3.80 should spark a solid short-covering rally that moves TEAR within range of its 52-week at $4.88 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.

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

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
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
QRM $0.12 -5.04%
AVNR $16.96 0.00%
DARA $0.84 3.70%
TEAR $2.47 1.20%
AAPL $132.65 1.82%

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