Traders can look to buy YOKU off any weakness to anticipate that breakout and simply use a stop that sits just below its 50-day at $19.80 or right below its 200-day at $19.21 a share. One could also buy YOKU off strength once it takes out those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.
Another stock that looks poised to trigger a near-term breakout trade is Kandi Technologies (KNDI), which is engaged in designing, developing, manufacturing, and commercializing all-terrain vehicles (ATVs), go-karts, and specialized automobiles, such as electric vehicles (EVs) for the People Republic of China and global markets. This stock is off to a hot start in 2013, with shares up 33%.
If you take a look at the chart for Kandi Technologies, you'll notice that this stock recently formed a double bottom chart pattern at $4.42 to $4.41 a share. Since marking that bottom, shares of KNDI have surged higher and broke back above its 50-day moving average at $5.23 a share. That move is quickly pushing shares of KNDI within range of triggering a near-term breakout trade that could lead to a super spike higher for the stock.Traders should now look for long-biased trades in KNDI if it manages to break out above some near-term overhead resistance levels at $5.25 to $5.67 a share high volume. Look for a sustained move or close above those levels with volume that hits near or above its three-month average volume of 1.99 million shares. If that breakout triggers soon, then KNDI will set up to re-test or possibly take out its next major overhead resistance levels at $6.50 to $7.18 a share. Any high-volume move above those levels will then put its 52-week high at $8.50 into range for shares of KNDI. Make note that this stock is spiking sharply higher today by over 10% to $5.38 a share with heavy upside volume. At last check, volume has already registered over 3.46 million shares, which is well above its three-month average action of 1.99 million shares.
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 + 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