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 big movers in the under-$10 complex from Thursday, including Astrotech (ASTC), which is exploding higher by 73%; XG Technology (XGTI), which is soaring higher by 35%; Ventrus Biosciences (VTUS), which is ripping higher by 28%; and Netlist (NLST), which is moving to the upside 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 ripped sharply higher was biopharmaceutical player CytRx (CYTR), which I highlighted in May 22's "5 Stocks Under $10 Set to Soar" at around $3.60 per share. I mentioned in that piece that CytRx was starting to spike higher right off its 50-day moving average and was quickly moving within range of triggering a big breakout trade above some near-term overhead resistance levels at $3.68 to its 200-day moving average of $3.86 a share.>>5 Large-Cap Trades for All-Time Highs Guess what happened? Shares of CytRx triggered that breakout the following trading session with decent upside volume flows. Volume on that trading session registered 2.07 million shares, which is well above its two-month average volume of 1.36 million shares. Shares of CYTR continued to uptrend, with the stock tagging an intraday high on May 28 of $4.29 a share. That represents a fat gain of 20% for anyone who anticipated the breakout and bought in before the move. As you can see, trading breakouts on small-cap stocks can produce solid gains very quickly. 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. >>3 Stocks Spiking on Big Volume 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.