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TheStreet Open House

5 Stocks Poised for Big Breakouts

Stocks in this article: YOKUKNDINTEMKTGLPR

Traders can look to buy KNDI off any weakness to anticipate that breakout and simply use a stop that sits right below its 200-day at $4.29 a share. One could also buy KNDI 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.

Keep in mind that KNDI has a decent amount of shorts involved in the name, since the current short interest as a percentage of the float for the stock is 6.9%. If that breakout triggers soon, then we could easily see a sharp short-covering rally, so make sure to keep this name on your breakout trading radar.

Nam Tai Electronics

One name that's quickly moving within range of triggering a big breakout trade is Nam Tai Electronics (NTE) ( NTE), which, is an electronics manufacturing and design services provider to a select group of the world's leading OEMs of telecommunications and consumer electronic products. This stock has been hammered by the bears so far in 2013, with shares off sharply by 42%.

If you look at the chart for Nam Tai Electronics, you'll notice that this stock has been uptrending strong for the last month, with shares marching higher from its low of $5.55 to its intraday high of $7.97 a share. During that move, shares of NTE have been consistently making higher lows and higher highs, which is bullish technical price action. This uptrending is coming after a severe downtrend for shares of NTE, which took the stock sharply lower from $13.95 to that recent low of $5.55 a share. Shares of NTE are now quickly moving within range of triggering a major breakout trade.

Traders should now look for long-biased trades in NTE if it manages to break out above some near-term overhead resistance levels at $8.08 to $8.62 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 volume of 696,471 shares. If that breakout triggers soon, then NTE will set up to re-fill some of its previous gap down zone from April that started near $12 a share. This stock could even potentially hit $13 to $14 a share if that gap gets filled with strong volume.

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