DELAFIELD, Wis. (Stockpickr) -- Trading stocks that trigger major breakouts can lead to massive profits. Once a stock trends to a new high or takes out a prior overhead resistance point, then it's free to find new buyers and momentum players who can ultimately push the stock significantly higher.
One example of a successful breakout trade I flagged recently was mobile Internet services player NQ Mobile (NQ), which I featured in Jan. 31's "5 Stocks Ready to Break Out" at $16.85 share. I mentioned in that piece that shares of NQ Mobile had been uptrending strong over the last two months, with shares making mostly higher lows and higher highs, which is bullish technical price action. That uptrend was starting to push shares of NQ within range of triggering a big breakout trade above some near-term overhead resistance levels at $18 to $18.50 a share.
Guess what happened? Shares of NQ started to flirt with those breakout levels on February 10. This stock has not looked back since with shares uptrending strong to its intraday high today of $21.69 a share. That move represents a fat gain of close to 30% since the time I flagged this breakout setup for shares of NQ. As you can see, trading breakouts can product solid gains once a stock clears a level that the sellers had control of. Shares of NQ might not be done going higher since the uptrend remains strong, so keep this name on your trading radar.
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Breakout candidates are something that I tweet about on a daily basis. I frequently tweet out high-probability setups, breakout plays and stocks that are acting technically bullish. These are the stocks that often go on to make monster moves to the upside. What's great about breakout trading is that you focus on trend, price and volume. You don't have to concern yourself with anything else. The charts do all the talking.
With that in mind, here's a look at five stocks that are setting up to break out and trade higher from current levels.