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DELAFIELD, Wis. ( Stockpickr) -- There isn't a day that goes by on Wall Street when certain stocks trading for $10 a share or less don't experience massive spikes higher. Traders savvy enough to follow the low-priced names and trade them with discipline and sound risk management are banking ridiculous coin on a regular basis.
Just take a look at some of the hot movers in the under-$10 complex from Thursday, including
Real Goods Solar (
RSOL), which is skyrocketing higher by 27%;
Aastrom Biosciences (
ASTM), which is ripping higher by 18%;
Kingold Jewelry (
KGJI), which is soaring by 17%; and
General Steel (
GSI), which is trending up by 10%. You don't even have to catch the entire move in lower-priced stocks such as these to make outsized returns when trading.
One low-priced stock that recently exploded to the upside was basic materials player
Gulf Resources (
GURE), which I highlighted in Sept. 16's "
5 Stocks Under $10 Making Big Moves" at $1.80 per share. I mentioned in that piece that shares of GURE were ripping higher right off its 50-day moving average of $1.70 a share with strong upside volume. That move was quickly pushing GURE within range of triggering a major breakout trade if it can manage to take out some near-term overhead resistance levels at $1.90 to its 52-week high at $2.06 a share with high volume.
Guess what happened? Shares of GURE didn't wait long to trigger that move, since the stock opened strong the following day and took out those breakout levels with massive upside volume. Shares of GURE tagged an intraday high on Wednesday of $3.10 a share, which represents a gain of 70% from that $1.80 level. That's a monster gain in just one day for anyone who played the stock once it cleared those key resistance levels with volume. Volume on Wednesday was over 8 million shares, which is well above its three-month average action of 316,577 shares.
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Low-priced stocks are something that I
tweet about on a regular basis. I frequently flag high-probability setups, breakout candidates and low-priced stocks that are acting technically bullish. I like to hunt for low-priced stocks that are showing bullish price and volume trends, since that increases the probability of those stocks heading higher. These setups often produce monster moves higher in very short time frames.
I'm not as eager to recommend investing long-term in stocks that trade less than $10 a share because these names can be very speculative, and the odds for picking the long-term winners aren't great. But I definitely love to
trade stocks that are priced below $10. I like to view them as a trading vehicle with lots of volatility and lots of upside when the trade is timed right.
When I trade under-$10 names, I do it almost entirely based off of the charts and technical analysis. I also like to find under-$10 names with a catalyst, but that's secondary to the chart and volume patterns.
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With that in mind, here's a look at
several under-$10 stocks that look poised to potentially trade higher from current levels.