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 Friday, including Zoom Technologies (ZOOM), which skyrocketed higher by 169%; Authentidate (ADAT), which exploded higher by 31%; Aastrom Biosciences (ASTM), which ripped higher by 27%; and Sino-Global Shipping America (SINO), which spiked sharply higher by 23%. 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 soared sharply higher was integrated circuits player Performance Technologies (PTIX), which I highlighted in Nov. 21's "5 Stocks Under $10 Set to Soar" at $2.98 per share. I mentioned in that piece that shares of Performance Technologies had been trending sideways and consolidating for the last three months, with the stock trading between $2.50 on the downside and $3.97 on the upside. Shares of PTIX had just started to spike higher back above its 50-day moving average and it was quickly moving within range of triggering a breakout trade above the upper-end of its recent range.Guess what happened? Shares of Performance Technologies didn't take long to trigger that move, since the stock skyrocketed higher the following day with heavy upside volume. This stock tagged an intraday high on Nov. 22 of $4.23 a share, which represents a huge gain of over 40% in just one day. The breakout for PTIX didn't hold following the move, but fast traders were able to capitalize and play the momentum for solid gains as PTIX took out all of the resistance levels I mentioned in the article. >>5 Short-Squeeze Stocks Ready to Pop 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. >>5 Breakout Trades for the Final Stretch of 2013 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. With that in mind, here's a look at several under-$10 stocks that look poised to potentially trade higher from current levels.
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