Ocean Rig UDW

One final stock that's trading within range of triggering a big breakout is Ocean Rig UDW ( ORIG), a Marshall Islands-registered international offshore drilling contractor. This stock is off to a monster start in 2012 with shares up over 40%.

If you look at the chart for Ocean Rig UDW, you'll notice that this stock bottomed in early 2012 at around $11.70 a share. Since marking that bottom, the stock has soared and up trended towards its current price of around $17.30. That big run-up now puts ORIG within range of breaking above two key technical overhead resistance levels. If that breakout does trigger soon, then it will push ORIG into all-time high territory.

Market players should now look for long-biased trades in ORIG if this stock can manage to take out some overhead resistance at $18.15 to $18.73 with high-volume. Look for a sustained high-volume move and close above those levels that are near or well above its three-month average action of 147,525 shares. If we get that action soon, then ORIG could easily spike above $20 a share very quickly.

One could look to be a buyer of ORIG off any weakness and simply use a stop at around $16.50 to $16.36 a share, and simply anticipate the future breakout. You could also buy off strength and get long once $18.15 or $18.73 is taken out with volume.

To see more breakout candidates, 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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