One more under-$10 stock that's trading within range of triggering a major breakout trade is
(EGHT - Get Report)
, which offers voice, video, mobile and unified communications solutions for business of all sizes. This stock has been on fire so far in 2012, with shares up by over 110%.
If you take a look at the chart for 8x8, you'll notice that this stock has been uptrending very strong for the last six months, with shares soaring from a low of $3.80 to its recent high of $7.02 a share. During that uptrend, shares of EGHT have been making higher lows and high highs, which is bullish technical price action. The stock recently pulled back off $7.02 to a low of $5.62 a share, but it's started to rebound back above its 50-day and move within range of triggering a major breakout trade.
Traders should now look for long-biased trades in EGHT once it manages to break out above some near-term overhead resistance at $6.55 to $7.02 a share with high volume. Look for a sustained move or close above those levels with volume that hits near or above its three-month average action of 850,540 shares. If that breakout triggers soon, then EGHT will have a great chance of hitting $8 to $10 a share or possible even higher.
One could look to buy EGHT off weakness to anticipate that breakout, and simply use a stop that sits right around its 50-day at $6.21 a share. One could also buy off strength once EGHT clears $6.55 to $7.02 a share with high volume and then simply use the same stop at around $6.21 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.
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