One name that's trending very close to triggering a major breakout trade is RealD (RLD - Get Report), which is global licensor of 3D technologies. Its extensive intellectual property portfolio enables a premium 3D viewing experience in the theater, the home and elsewhere. This stock has been hit by the sellers during the last six months, with shares down by 26%.
If you take a look at the chart for RealD, you'll notice that this stock has been uptrending pretty strong for the last three months, with shares moving from a low of $8.57 to its recent high of $11.40 a share. During that uptrend, shares of RLD have been consistently making higher lows and higher highs, which is bullish technical price action. That move has now pushed RLD within range of triggering a major breakout trade.
Traders should now look for long-biased trades in RLD if it manages to break out above its 200-day at $11.12 a share and then once it takes out more overhead resistance levels at $11.31 to $11.40 a share with high volume. Look for volume on that move that hits near or above its three-month average action of 365,564 shares. If that breakout hits soon, then RLD will set up to re-fill its previous gap down zone from August that started around $13 a share. Any high-volume move above $13 could then send RLD towards $14 to $15 a share.Traders can look to buy RLD off any weakness to anticipate that breakout and simply use a stop that sits right below its 50-day at $10.03 a share. One could also buy RLD off strength once it takes out those breakout levels with volume and then simply use a stop that sits just below $10.50 a share.