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TheStreet Open House

5 Stocks Ready to Explode Higher

Plug Power

An alternative energy player that could be setting up for an explosive move higher is Plug Power (PLUG), which engages in the design, development, commercialization, and manufacture of fuel cell systems for the industrial off-road markets worldwide. This stock has been exploding to the upside so far in 2014, with shares up a massive 142%.

>>4 Hot Stocks on Traders' Radars

If you look at the chart for Plug Power, you'll notice that this stock has been uptrending over the last month, with shares moving higher from is low of $2.22 to its intraday high of $3.84 a share. During that uptrend, shares of PLUG have been consistently making higher lows and higher highs, which is bullish technical price action. That move is now starting to push shares of PLUG within range of triggering a major breakout trade. This chart reminds me of DHRM's breakout right before it went on to trade up over 100%.

Traders should now look for long-biased trades in PLUG if it manages to break out above some near-term overhead resistance levels at $4.20 to its 52-week high at $4.90 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 20.19 million shares. If that breakout hits soon, then PLUG will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $8 to $10 a share.

Traders can look to buy PLUG off any weakness to anticipate that breakout and simply use a stop that sits right around some near-term support at $3 a share or close to its 50-day moving average of $2.60 a share. One can also buy PLUG off strength once it starts to clear those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.

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