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, it's free to find new buyers and momentum players -- which can ultimately push the stock significantly higher.

Breakout candidates are something that I tweet about on a daily basis. These are also the exact type of stocks I love to trade.

I frequently flag high-probability setups, breakout plays and stocks that are acting technically bullish. These are the ones 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.

Trading breakouts is not a new game on Wall Street. This strategy has been mastered by legendary traders such as William O'Neal, Stan Weinstein and Nicolas Darvas. These pros know that once a stock starts to break out above past resistance levels and holds above those breakout prices, it can easily trend significantly higher.

With that in mind, here's a look at five stocks that are setting up to break out and possibly trade higher from current levels.

Diplomat Pharmacy

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One health care player that's starting to trend within range of triggering a big breakout trade is Diplomat Pharmacy (DPLO) - Get Report , which operates as an independent specialty pharmacy in the U.S. This stock has been smacked hard by the sellers over the last six months, with shares falling sharply by 62.6%.

If you take a look at the chart for Diplomat Pharmacy, you'll notice that this stock has been uptrending a bit over the last few weeks, with shares moving higher off its new 52-week low of $12.25 a share to its intraday high on Friday of $14.06 a share. During that uptrend, shares of Diplomat Pharmacy have been making mostly higher lows and higher highs, which is bullish technical price action. That uptrend has now pushed this stock back above its 20-day moving average of $13.12 a share and above its 50-day moving average of $13.88 a share. That bump higher is now quickly pushing shares of Diplomat Pharmacy within range of triggering a major breakout trade.

Traders should now look for long-biased trades in Diplomat Pharmacy if it manages to break out above some near-term overhead resistance levels at $15.03 to $15.39 a share and then above $15.63 to its gap-down-day high from last October around $16 a share with high volume. Look for a sustained move or close above those levels with volume that registers near or above its three-month average action of 1.39 million shares. If that breakout fires off soon, then this stock will set up to refill some of its previous gap-down-day zone that started near $23 a share.

Traders can look to buy Diplomat Pharmacy off weakness to anticipate that breakout and simply use a stop that sits right below its 20-day moving average of $13.12 a share, or around its new 52-week low of $12.25 a share. One can also buy this stock 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.

GNC Holdings

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A services player that's starting to move within range of triggering a big breakout trade in GNC Holdings (GNC) - Get Report , a specialty retailer of health, wellness and performance products. This stock has been hit hard by the sellers over the last six months, with shares dropping large by 57.5%.

If you take a glance at the chart for GNC Holdings, you'll notice that this stock has been consolidating and trending sideways over the last month, with shares moving between $10.29 a share on the downside and $11.72 a share on the upside. This sideways trend for shares of GNC Holdings is coming after a massive downtrend over the last four months that saw the stock fall from its high of $22 a share to its new 52-week low of $10.29 a share. This stock is now started to rebound off that $10.29 low and it's quickly trending within range of triggering a big breakout trade above the upper end of its recent sideways trending chart pattern.

Traders should now look for long-biased trade in GNC Holdings if it manages to break out above some near-term overhead resistance levels at $11.45 to its 20-day moving average of $11.67 a share and then above more resistance at $11.72 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 2.74 million shares. If that breakout develops soon, then this stock will set up to retest or possibly take out its next major overhead resistance levels at $12.60 to its 50-day moving average of $13.03 a share, or even $14.42 to $15.04 a share

Traders can look to buy GNC Holdings off weakness to anticipate that breakout and simply use a stop that sits right below some near-term support levels at $10.81 or $10.29 a share. One could also buy this stock off strength once it starts to take out those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.

Scynexis

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A pharmaceutical player that's starting to trend within range of triggering a near-term breakout trade is Scynexis (SCYX) - Get Report , which develops and commercializes novel anti-infectives to address unmet therapeutic needs. This stock has been red hot over the last six months, with shares soaring higher by 75%.

If you take a glance at the chart of Scynexis, you'll notice that this stock recently formed a double bottom chart pattern, after shares found some buying interest at $3.18 to $3.26 a share over the last month. Following that potential bottom, this stock has now started to bounce higher and trend back above both its 20-day moving average of $3.38 a share and its 50-day moving average of $3.46 a share. That bounce is now quickly pushing shares of Scynexis within range of triggering a near-term breakout trade above some key overhead resistance levels.

Traders should now look for long-biased trades in Scynexis if it manages to break out above some near-term overhead resistance levels at $3.68 to $3.73 a share and then above more resistance at $3.78 a share with high volume. Look for a sustained move or close above those levels with volume that registers near or above its three-month average action of 406,651 shares. If that breakout materializes soon, then this stock will set up to retest or possibly take out its next major overhead resistance levels at $4.04 to $4.21, or even $4.60 to $5 a share.

Traders can look to buy Scynexis off weakness to anticipate that breakout and simply use a stop that sits right below those recent double bottom support levels, or around more near-term support at $3.10 to $3 a share. One can also buy this stock off strength once it starts to trend above those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.

Threshold Pharmaceuticals

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A biotechnology player that's starting to trend within range of triggering a big breakout trade is Threshold Pharmaceuticals (THLD) , which discovers and develops therapeutic agents that target tumor cells for the treatment of cancer patients in the U.S. This stock has trended off a bit over the last six months, with shares falling by 10.6%.

If you take a glance at the chart for Threshold Pharmaceuticals, you'll notice that this stock recently formed a major bottoming chart pattern, after shares found support numerous times at 44 to 43 cents per share over the last two months. Following that potential bottom, shares of Threshold Pharmaceuticals have now started to bounce higher right off both its 50-day moving average of 46 cents per share and its 20-day moving average of 47 cents per share. That bounce off the moving averages is now quickly pushing this stock within range of triggering a big breakout trade above some key overhead resistance levels.

Traders should now look for long-biased trades in Threshold Pharmaceuticals if it manages to break out above some near-term overhead resistance levels at 52 to 55 cents per share and then above its 200-day moving average of 57 cents per share to 60 cents per 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 767,410 shares. If that breakout takes hold soon, then this stock will set up to retest or possibly take out its next major overhead resistance level at 70 cents per share. Any high-volume move above 70 cents per share will then give this stock a chance to refill some of its previous gap-down-day zone from last September that started near $1.20 a share.

Traders can look to buy Threshold Pharmaceuticals off weakness to anticipate that breakout and simply use a stop that sits right below some big support at around 43 to 40 cents per share. One can also buy this stock off strength once it starts to bust above those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.

AveXis

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My final breakout trading prospect is clinical-stage therapy player AveXis (AVXS) , which engages in developing and commercializing novel treatments for patients suffering from rare and life-threatening neurological genetic diseases. This stock has been in play with the bulls over the last six months, with shares ripping sharply higher by 51.2%.

If you look at the chart for AveXis, you'll notice that this stock has recently started to rebound higher right off its 20-day moving average of $51.29 a share. That rebound is coming after shares of AveXis found some big buying interest at $46.50 to $44.70 a share over the last few months. This stock is now starting to spike higher off its 20-day moving average, and it's within range of triggering a near-term breakout trade above some key overhead resistance levels.

Traders should now look for long-biased trades in AveXis if it manages to break out above some near-term overhead resistance levels at $56.21 to its 50-day moving average of $56.45 a share with volume that registers near or above its three-month average action of 560,522 shares. If that breakout develops soon, then this stock will set up to retest or possibly take out its next major overhead resistance levels at $58.64 to $60.25, or even $62.50 to $70 a share.

Traders can look to buy shares of AveXis off weakness to anticipate that breakout and simply use a stop that sits right below its 20-day moving average of $51.29 a share or around more near-term support at $50.68 a share. One can also buy this stock off strength once it starts to spike above those breakout levels with volume and then simply use a stop that sits a conformable percentage from your entry point.

This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.