My final breakout trading prospect is specialty biopharmaceutical player Auxilium Pharmaceuticals ( AUXL), which develops and markets products to urologists, endocrinologists, orthopedists and select primary care physicians and plastic surgeons who focus on the hand, and rheumatologists. This stock is off to a slow start in 2013, with shares up just 8.3% during the last six months.
If you look at the chart for Auxilium Pharmaceuticals, you'll notice that this stock recently formed a triple bottom chart pattern at $17.36, $17.74 and $17.57 a share. Following that bottom, shares of AUXL have now started to trend back above its 50-day moving average of $18.29 a share. That move is quickly pushing shares of AUXL within range of triggering a near-term breakout trade.Traders should now look for long-biased trades in AUXL if it manages to break out above some near-term overhead resistance levels at $19 to $19.08 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 834,717 shares. If that breakout triggers soon, then AUXL will set up to re-test or possibly take out its next major overhead resistance level at $20.95 a share. Any high-volume move above that level will then give AUXL a chance to re-test its 52-week high at $25.54 a share. Traders can look to buy AUXL off any weakness to anticipate that breakout and simply use a stop that sits right below some key near-term support levels at $17.36 to $16.77 a share. One could also buy AUXL off strength once it clears those breakout levels with volume and then simply use a stop that sits a conformable percentage from your entry point. To see more breakout candidates, check out the Breakout Stocks of the Week portfolio on Stockpickr. -- Written by Roberto Pedone in Delafield, Wis.
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