5 Stocks Poised for Big Breakouts

WINDERMERE, Fla. ( Stockpickr) -- 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, then it's free to find new buyers and momentum players that can ultimately push the stock significantly higher.

One recent example of a successful breakout trade was biotechnology and drugs player Sarepta Therapeutics ( SRPT), which I highlighted on Aug. 17 because it was uptrending strong with bullish volume flows. I pointed out how SPRT was holding its gains and was trending very close to taking out some near-term overhead resistance at $10.78 a share. I also mentioned that SRPT was holding key support at $10 to $9 a share.

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Shares of SRPT never looked back after I wrote that piece. The stock went on to trigger that breakout above $10.78 with massive upside volume. The stock gapped up a number of times this week and hit an intraday high on Thursday of $15.18 a share. That's a monster gain in just two weeks from my call. The best part about SRPT is that you had price and volume conformation on the breakout, which raised the probability of it being a successful trade.

In fact, I even tweeted a number of times about SRPT and how it was setting up bullishly for a major breakout after I wrote that piece. Tweeting about high-probability trading setups, breakout candidates and trend trading in general is something that I do frequently and passionately.

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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 hold above those breakout prices, then 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 trade higher from current levels.

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