Another under-$10 name that's starting to move within range of triggering a near-term breakout trade is
(BSPM), which develops, manufactures and markets pharmaceutical products for a variety of diseases and conditions in the People's Republic of China. This stock is off to a decent start in 2013, with shares up 12.9% so far.
If you take a look at the chart for Biostar Pharmaceuticals, you'll notice that this stock is just starting to spike higher off its 50-day moving average of $1.06 a share with above-average volume. This move is quickly pushing shares of BSPM within range of triggering a near-term breakout trade.
>>4 Biotech Stocks Under $10 Moving Higher
Market players should now look for long-biased trades in BSPM if it manages to break out above some near-term overhead resistance levels at $1.18 a share to its 200-day moving average at $1.21 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 37,579 shares. If that breakout triggers soon, then BSPM will set up to re-test or possibly take out its next major overhead resistance levels at $1.36 to $1.39 a share. Any high-volume move above $1.39 will then put $1.55 to $2 into range for shares of BSPM.
Traders can look to buy BSPM off any weakness to anticipate that breakout and simply use a stop that sits right below its 50-day moving average of $1.06 a share. One could also buy BSPM off strength once it takes out those breakout levels with volume and then simply use a stop that sits just below $1.10 a share.
Check Out Our Best Services for Investors
Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
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
Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.
- Model portfolio
- Stocks trading below $10
- Intraday trade alerts