One biopharmaceutical player that's quickly moving within range of triggering a major breakout trade is Ariad Pharmaceuticals (ARIA - Get Report), an oncology company that focuses on the discovery, development and commercialization of medicines for cancer patients. This stock has been on fire over the last three months, with shares up a whopping 59%.
If you take a look at the chart for Ariad Pharmaceuticals, you'll notice that this has been trending sideways and consolidating over the last month, with shares moving between $5.92 on the downside and $7.75 on the upside. Shares of ARIA are gapping up here and starting to move within range of triggering a major breakout trade above the upper-end of its recent sideways trading chart pattern.>>2 Biotech Stocks Under $10 to Watch Traders should now look for long-biased trades in ARIA if it manages to break out above some near-term overhead resistance at $7.75 a share with high volume. Look for a sustained move or close above that level with volume that hits near or above its three-month average volume of 26.20 million shares. If that breakout hits soon, then ARIA will set up to re-fill some of its previous gap down zone from last October that started near $18 a share. If ARIA gets into that gap with strong volume, then this stock could easily tag $10 to $12 a share. Traders can look to buy ARIA off any weakness to anticipate that breakout and simply use a stop that sits right around some key near-term support levels at $6.32 or at $5.92 a share. One can also buy ARIA off strength once it starts to take out $7.75 a share with volume and then simply use a stop that sits a comfortable percentage from your entry point.