Quantum Another stock that's setting up for a major breakout trade is Quantum (QTM - Get Report), hich provides solutions for storing and protecting information in physical, virtual, clouds and big data environments. This stock is off to a weak start in 2012, with shares down by around 30%.
If you take a look at the chart for Quantum, you'll see that this stock has been uptrending very strong for the last two months, with shares soaring higher from $1.20 to its recent high of $1.77 a share. That move has quickly pushed QTM within range of triggering a near-term breakout trade, if the stock can manage to take out the higher-end of its trading range.
Market players should now look for long-biased trades in QTM once it manages to take out some near-term overhead resistance levels at $1.70 to $1.77 a share with high volume. Look for a sustained move or close above those levels with volume that tracks in close to or above its three-month average action of 1,712,170 shares. If that breakout triggers soon, then QTM will setup to re-test or possibly take out its next major overhead resistance levels at $2.09 to $2.19 a share. If that $2.19 level gets taken out with volume, then QTM could even tag $2.50 to $2.80 a share.One can look to buy QTM off any weakness and anticipate that breakout and simply use a stop that sits right below some near-term support at $1.55 to $1.50 a share. One could also buy off strength once QTM takes out $1.70 to $1.77 with volume and then use a stop that sits just below its 50-day moving average of $1.59 a share.