ARC Document Solutions
One under-$10 stock that's trending very close to trigger a major breakout trade is ARC Document Solutions (ARC), which provides highly specialized document management services, document distribution and logistics, and print-on-demand services. This stock has been hammered by the sellers during the last six months, with shares off by 43%.
If you take a look at the chart for ARC Document Solutions, you'll notice that this stock is just starting to move back above its 50-day moving average of $2.45 a share with decent volume. This move is quickly pushing shares of ARC within range of triggering a major breakout trade. That breakout would send shares of ARC above its recent consolidation pattern, which has the stock trending between $2.27 on the downside and $2.81 on the upside.
Traders should now look for long-biased trades in ARC if it manages to break out above some near-term overhead resistance levels at $2.55 to $2.65 a share and then once it clears more resistance at $2.81 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 125,316 shares. If that breakout triggers soon, then ARC will set up to re-test or possibly take out its next major overhead resistance levels at $3.60 to its 200-day moving average at $3.82 a share. Any high-volume move above its 200-day would then put $4.15 to $4.24 into range for shares of ARC.Traders can look to buy ARC off any weakness to anticipate that breakout and simply use a stop that sits just below some near-term support levels at $2.27 to $2.19 a share. One can also buy ARC off strength once it takes out those breakout levels with volume and then simply use a stop that sits just below its 50-day moving average at $2.45 a share.
Select the service that is right for you!COMPARE ALL SERVICES
- $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
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV