Stocks that are making large moves like these are favorites among short-term traders because they can jump into these names and try to capture some of that massive volatility. Stocks that are making big-percentage moves either up or down are usually in play because their sector is becoming attractive or they have a major fundamental catalyst such as a recent earnings release. Sometimes stocks making big moves have been hit with an analyst upgrade or an analyst downgrade.
Regardless of the reason behind it, when a stock makes a large-percentage move, it is often just the start of a new major trend -- a trend that can lead to huge profits. If you time your trade correctly, combining technical indicators with fundamental trends, discipline and sound money management, you will be well on your way to investment success.
With that in mind, let's take a closer look at a several stocks under $10 that are making large moves to the upside.
MEI Pharma (MEIP) - Get Report, a development-stage oncology company, focuses on the clinical development of therapeutics for the treatment of cancer. This stock closed up 2.4% to $6.26 in Thursday's trading session.
Thursday's Range: $5.89-$6.35
52-Week Range: $5.51-$13.98
Thursday's Volume: 74,000
Three-Month Average Volume: 237,782
From a technical perspective, MEIP bounced modestly higher here right below its 50-day moving average of $6.40 with lighter-than-average volume. This stock bucked the market weakness on Thursday and counter-trended higher. That move is starting to push shares of MEIP within range of triggering a near-term breakout trade. That trade will hit if MEIP manages to take out its 50-day at $6.40 and then once it clears some more key overhead resistance levels at $6.83 to $6.85 with high volume.
Traders should now look for long-biased trades in MEIP as long as it’s trending above Thursday's intraday low of $5.89 or above more key near-term support at $5.51 and then once it sustains a move or close above those breakout levels with volume that hits near or above 237,782 shares. If that breakout gets underway soon, then MEIP will set up to re-test or possibly take out its next major overhead resistance levels at $7.40 to $7.44, or even its 200-day moving average of $8.27.
Avanir Pharmaceuticals (AVNR) , together with its subsidiaries, is engaged in acquiring, developing and commercializing novel therapeutic products for the treatment of central nervous system disorders primarily in the U.S. This stock closed up 1.2% to $5.62 in Thursday's trading session.
Thursday's Range: $5.38-$5.72
52-Week Range: $2.62-$6.00
Thursday's Volume: 2.01 million
Three-Month Average Volume: 2.93 million
From a technical perspective, AVNR jumped modestly higher here right above some near-term support at $5.32 and above its 50-day moving average of $5.20 with decent upside volume. This modest relative strength on Thursday is now starting to push shares of AVNR within range of triggering a near-term breakout trade. That trade will hit if AVNR manages to take out Thursday's intraday high of $5.72 to $5.83 and then above its 52-week high at $6 with high volume.
Traders should now look for long-biased trades in AVNR as long as it's trending above its 50-day at $5.20 or above more near-term support at $5 and then once it sustains a move or close above those breakout levels with volume that hits near or above 2.93 million shares. If that breakout gets set off soon, then AVNR will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $6.50 to $7, or even $7.50.
Dara BioSciences (DARA) , a development stage biopharmaceutical company, develops and commercializes oncology treatment and supportive care pharmaceutical products in the U.S. This stock closed up 5.3% to $1.37 share in Thursday's trading session.
Thursday's Range: $1.26-$1.41
52-Week Range: $1.02-$4.40
Thursday's Volume: 5.04 million
Three-Month Average Volume: 1.47 million
From a technical perspective, DARA ripped higher here back above its 50-day moving average of $1.29 with monster upside volume. This strong spike higher on Thursday pushed shares of DARA into breakout territory, since the stock took out its 50-day and some near-term overhead resistance at $1.34. Shares of DARA are now starting to trend within range of triggering another big breakout trade. That trade will hit if DARA manages to take out Thursday's intraday high of $1.41 to some more key overhead resistance at $1.52 with high volume.
Traders should now look for long-biased trades in DARA as long as it's trending above its 50-day at $1.29 or above $1.25 and then once it sustains a move or close above those breakout levels with volume that hits near or above 1.47 million shares. If that breakout hits soon, then DARA will set up to re-fill some of its previous gap-down-day zone from May that started just above $2.
To see more stocks that are making notable moves higher, check out the Stocks Under $10 Moving Higher portfolio on Stockpickr.
-- Written by Roberto Pedone in Delafield, Wis.
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At the time of publication, author had no positions in stocks mentioned. Roberto Pedone, based out of Delafield, Wis., is an independent trader who focuses on technical analysis for small- and large-cap stocks, options, futures, commodities and currencies. Roberto studied international business at the Milwaukee School of Engineering, and he spent a year overseas studying business in Lubeck, Germany. His work has appeared on financial outlets including CNBC.com and Forbes.com. You can follow Pedone on Twitter at www.twitter.com/zerosum24 or @zerosum24.