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

5 Stocks Under $10 Set to Soar

Stocks in this article: SUPN LEAP NBG MEG MTOR DCTH

Meritor

Another under-$10 name that's starting to move within range of triggering a near-term breakout trade is Meritor ( MTOR), which is engaged in the supply of a range of integrated systems, modules and components to original equipment manufacturers and the aftermarket for commercial vehicle, transportation and industrial sectors. This stock is off to a strong start in 2013, with shares up 50%.

>>5 Stocks Under $10 Making Big Moves

If you take a look at the chart for Meritor, you'll notice that this stock has been trending sideways inside of a consolidation pattern for the last month, with shares moving between $6.70 on the downside and $7.50 on the upside. Shares of MTOR are now starting to trend higher above that $6.70 low, and it's quickly moving within distance of triggering a near-term breakout trade above the upper-end of its recent sideways chart pattern.

Market players should now look for long-biased trades in MTOR if it manages to break out above some near-term overhead resistance levels at $7.25 to $7.50 a share with high volume. Look for a sustained move or close above those levels with volume that registers near or above its three-month average action of 1.49 million shares. If that breakout triggers soon, then MTOR will set up to enter new 52-week high territory above $7.50, which is bullish technical price action. Some possible upside targets off that breakout are its next major overhead resistance levels at $8.74 to $10.31 a share. Any high-volume move above $10.31 a share could then send shares of MTOR towards $12.

Traders can look to buy MTOR off weakness to anticipate that breakout and simply use a stop that sits right below some key near-term support levels at $6.70 to $6.25 a share. One can also buy MTOR off strength once it clears those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.

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