This Day On The Street
Continue to site
ADVERTISEMENT
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

5 Stocks Setting Up to Break Out

Supernus Pharmaceuticals

One stock that's starting to move within range of triggering a major breakout trade is Supernus Pharmaceuticals ( SUPN), which is focused on developing and commercializing products for the treatment of central nervous system, or CNS, diseases. This stock has been under pressure by the sellers so far in 2013, with shares off by 18.6%.

>>5 Stocks Insiders Love Right Now

If you take a look at the chart for Supernus Pharmaceuticals, you'll notice that this stock has been uptrending for the last month, with shares moving higher from its low of $4.45 to its intraday high of $6.09 a share. During that uptrend, shares of SUPN have been consistently making higher lows and higher highs, which is bullish price action. That move has now pushed shares of SUPN back above its 50-day moving average at $5.52 a share, and the stock is now quickly moving within range of triggering a major breakout trade.

Traders should now look for long-biased trades in SUPN if it manages to break out above some near-term overhead resistance levels at $5.68 to $6.29 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 438,265 shares. If that breakout triggers soon, then SUPN will set up to re-test or possibly take out its next major overhead resistance levels at $7 to $8 a share. Any high-volume move above $8.06 to $8.15 would then give SUPN a chance to re-fill some of its previous gap down zone from last December that started near $11 a share.

Traders can look to buy SUPN off any weakness to anticipate that breakout and simply use a stop that sits right around its 50-day at $5.52 a share or right below $5 a share. One could also buy SUPN off strength once it takes out those breakout levels with volume and then simply use a stop right below its 50-day at $5.52 a share.

This stock is a favorite target of the short-sellers, since the current short interest as a percentage of the float for SUPN is extremely high at $30.8%. The bears have also been increasing their bets from the last reporting period by 21.4%, or by about 750,000 shares. If this stock triggers that breakout soon, then the bears could get caught pressing their bets into a monster move higher.

2 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
Only $9.95
14-Days Free

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
Submit an article to us!
SYM TRADE IT LAST %CHG
DGIT $12.07 -0.33%
BBY $35.64 0.00%
OSIS $67.77 0.00%
SUPN $13.25 0.00%
AAPL $128.70 0.00%

Markets

DOW 18,070.40 +46.34 0.26%
S&P 500 2,114.49 +6.20 0.29%
NASDAQ 5,016.9290 +11.5380 0.23%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs