Rare Element Resources
My final idea today that could be ready to trigger a major breakout trade is Rare Element Resources (REE), which is engaged in the acquisition, exploration and development of mineral properties. This stock is off to a hot start so far in 2012, with shares up over 50%.
If you look at the chart for Rare Element Resources, you'll see that this stock has just started to bounce strong off its 50-day moving average of $4.30 a share with decent upside volume. That move is quickly pushing REE within range of taking out its 200-day moving average at $5.04 a share, and then possibly taking out some more overhead resistance levels. If those resistance levels are cleared with decent volume, then REE will trigger a major breakout trade.
Traders should now look for long-biased trades in REE once it manages to clear some near-term overhead resistance levels at $5.04 to $5.50 a share with high volume. Look for volume off that move that hits near or above its three-month average action of 462,603 shares. If that breakout triggers soon, then REE will setup to re-test or possibly take out its next major overhead resistance levels at $6 to around $7 a share.One could look to get long REE off weakness, and simply use a stop just below its 50-day moving average of $4.30 a share. You could also just buy off strength once REE clears $5.04 to $5.50 a share with high volume, and then simply use a stop at around its $4.75 to $4.50 a share. To see more breakout candidates, check out the Breakout Stocks of the Week portfolio on Stockpickr. -- Written by Roberto Pedone in Winderemere, Fla.
Twitter and become a fan on Facebook.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
24/7 market commentary from Jim Cramer and 20+ veteran Wall Street gurus. Get access to the latest trading ideas on stocks, options, and ETFs as well as a real-time forum to see the pros exchanging their investment ideas.
- Jim Cramer + 20 Wall Street pros
- Intraday commentary & news
- Real-time trading forum
- Actionable trade ideas
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV