One under-$10 stock that's trading very close to triggering a near-term breakout trade is Pluristem Therapeutics (PSTI), a bio-therapeutics company engaged in the commercialization of non-personalized cell therapy products for the treatment of several severe degenerative, ischemic and autoimmune disorders. This stock has been on fire so far in 2012, with shares up a whopping 60%.
If you take a look at the chart for Pluristem Therapeutics, you'll notice that this stock recently formed a double top at around $5 to $4.90 a share, after soaring from a low of $2.26 a share. Following that double top, shares of PSTI abruptly pulled back to its recent low of $3.65 a share. During that pullback, shares of PSTI were making lower highs and lower lows, which is bearish technical price action. That said, the stock has now started to rebound back above its 50-day moving average of $4 a share. That move is quickly pushing PSTI within range of triggering a near-term breakout trade.Traders should now look for long-biased trades in PSTI as long as it's trending above its 50-day at $4, and then once it breaks out above some near-term overhead resistance at $4.28 a share with high volume. Look for a sustained move or close above $4.28 with volume that hits near or above its three-month average action of 1.4 million shares. If that breakout triggers soon, then PSTI will setup to re-test or possibly take out those double top price levels at $4.90 to $5 a share. Any high-volume move above $5 a share should setup PSTI to trend north of $6 a share. Traders can now look to buy PSTI off weakness and simply use a stop somewhere below its 50-day moving average of $4 a share, or possibly around that recent low of $3.65 a share. A better strategy might be to buy off strength once PSTI takes out $4.28 a share with volume and then use a stop right around its 50-day.
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
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
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
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