Another stock that's setting up for a big breakout is Celsion ( CLSN), an oncology drug development company focused on the development of therapeutics for those suffering with difficult to treat forms of cancer. This is another stock off to a solid start in 2012, with shares up over 15%.

If you take a look at the chart for Celsion, you'll see that this stock was hammered by the bears from its November high of $3.84 to a recent low of $1.64 a share. After tagging that low last month, the stock has rebounded sharply and is now approaching a number of key breakout levels. What's bullish about shares of Celsion here is that the stock is coming up on those breakout levels and the upside volume is tracking in strong.

Market players should now watch for CLSN to break out above some near-term overhead resistance at $1.95 to $1.99 a share, and its 50-day moving average of $2.01 a share on solid volume. Look for volume on a move above those levels that registers near or well above its three-month average action of 385,810 shares. At last check, CLSN has hit a high of $2.07 today, and the volume is already well above its average.

One could be a buyer of CLSN off any close above the 50-day that's accompanied by strong volume. I would simply use a mental stop that's right below $1.95 in case this breakout fails. If we do get that action either today or soon, then I would target a spike back towards some near-term resistance at $2.40 a share, or possibly its 200-day moving average of $2.83 a share.

Keep in mind that CLSN has a decent short interest since 9.1% of the tradable float is currently sold short by the bears. Any future breakout could easily spark a big short-squeeze as the bears cover some of their positions to avoid short-term losses.

To see more breakout candidates, including Vonage Holdings ( VG), Glu Mobile ( GLUU) and Zoom Technologies ( ZOOM), check out the Breakout Stocks of the Week portfolio on Stockpickr.

-- Written by Roberto Pedone in Winderemere, Fla.


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At the time of publication, author had no positions in stocks mentioned.

Roberto Pedone, based out of Windermere, Fla., is an independent trader who focuses on stocks, options, futures, commodities and currencies. He is also an outside contributor to Beconequity.com and maintains the website Maddmoney.net, which he sold to Blue Wave Advisors in 2008. Roberto studied International Business at The Milwaukee School of Engineering, and he spent a year overseas studying business in Lubeck, Germany.

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