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Stocks Under $10 with 50-100% upside potential - 14 days FREE!

5 Stocks Under $10 Triggering Breakouts

Flamel Technologies

One final under-$10 name that's trending very close to triggering a near-term breakout trade is Flamel Technologies (FLML), a biopharmaceutical company mainly engaged in the development of two unique polymer-based drug delivery technologies for the improvement of medical applications. This stock is off to a hot start in 2013, with shares up 36%.

If you take a look at the chart for Flamel Technologies, you'll see that this stock has been uptrending strong for the last month, with shares moving higher from its low of $3.30 a share to its intraday high of $4.14 a share. During that uptrend, shares of FLML have been consistently making higher lows and higher highs, which is bullish technical price action. That move is quickly pushing FLML within range of triggering a near-term breakout trade.

Traders should now look for long-biased trades in FLML if it manages to break out above some near-term overhead resistance levels at $4.09 a share and at its 200-day moving average of $4.10 a share and 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 45,383 shares. If that breakout triggers soon, then FLML will set up to re-test or possibly take out its next major overhead resistance levels at $4.69 to $5 a share. Any high-volume move above $5 will then put $5.50 to $5.75 into range for shares of FLML.

Traders can look to buy FLML off any weakness to anticipate that breakout and simply use a stop that sits right below some key near-term support levels at $3.82 to $3.80 a share. One could also buy FLML off strength once it clears those breakout levels with volume and then simply use a stop that sits right below its 50-day moving average at $3.91 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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At the time of publication, author had no positions in stocks mentioned.

Roberto Pedone, based out of Windermere, Fla., is an independent trader who focuses on technical analysis for small- and large-cap stocks, options, futures, commodities and currencies. Roberto studied international business at the Milwaukee School of Engineering, and he spent a year overseas studying business in Lubeck, Germany. His work has appeared on financial outlets including CNBC.com and Forbes.com. You can follow Pedone on Twitter at www.twitter.com/zerosum24 or @zerosum24.

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