This Day On The Street
Continue to site right-arrow
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
Cramer's Action Alerts PLUS - See his portfolio and get alerts BEFORE every trade. Learn more NOW!

5 Under-$10 Stocks Showing Profit Potential

DragonWave Another under-$10 name that's trading very close to triggering a big breakout trade is DragonWave (DRWI), which is a producer of high-capacity packet microwave solutions which transmit voice, video, and data over broadband connections. This stock has been hammered by the sellers so far in 2012, with shares down by 32%.

If you take a look at the chart for DragonWave, you'll notice that this stock has been uptrending modestly for the last month, with shares moving higher from its low of $1.75 to its intraday high of $2.39 a share. During that uptrend, shares of DRWI have been mostly making higher lows and higher highs, which is bullish technical price action. This stock has also just started to bounce off its 50-day moving average of $2.21 today and it's quickly moving within range of triggering a big breakout trade.

Market players should now look for long-biased trades in DRWI once it manages to take out some near-term overhead resistance levels at $2.50 to $2.52 a share and then once it clears more overhead resistance at $2.72 to $2.91 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 210,234 shares. If that breakout triggers soon, then DRWI will set up to re-test or possibly take out its next significant overhead resistance levels at $3.20 to $4 a share.

Traders can look to buy DRWI off any weakness and then simply use a stop that sits right around some key near-term support at $1.92 a share. One could also buy DRWI off strength once it takes out those breakout levels with volume and then simply use a stop that sits right around its 50-day at $2.21 a share.

5 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
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

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
Try it NOW
Try it NOW
Try it NOW
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!
ACTV $0.00 0.00%
ASTM $3.60 4.35%
ADNC $4.88 0.00%
AOI $0.95 0.00%
SMCI $40.18 0.00%


DOW 18,132.70 -81.72 -0.45%
S&P 500 2,104.50 -6.24 -0.30%
NASDAQ 4,963.5270 -24.3630 -0.49%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs