My final breakout trading idea today is Rackspace Hosting ( RAX), which is a provider of cloud computing services, managing Web-based IT systems for small and medium-sized businesses as well as large enterprises. This stock has been destroyed by the sellers so far in 2013, with shares off by a whopping 51.8%. >>5 Stocks Insiders Love Right Now If you look at the chart for Rackspace Hosting, you'll notice that this stock has been downtrending badly for the last six months, with shares plunging lower from its high of near $80 to its recent low of $33.91 a share. During that downtrend, shares of RAX have mostly been making lower highs and lower lows, which is bearish technical price action. That said, shares of RAX recently formed a double bottom at $33.91 to $34 a share. Shares of RAX have now started to rebound off that double bottom area and the stock is quickly moving within range of triggering a near-term breakout trade above a key descending trendline. Traders should now look for long-biased trades in RAX if it manages to break out above some near-term overhead resistance levels at $38.12 to $39.90 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 2.31 million shares. If that breakout triggers soon, then RAX will set up to re-test or possibly take out its next major overhead resistance levels at its 50-day moving average of $41.37 to $43.16 a share. Any high-volume move above those levels will then give RAX a chance to re-fill its previous gap down zone from May that started at $52.45 a share. Traders can look to buy RAX off any weakness to anticipate that breakout and simply use a stop that sits right below its double bottom area at $34 to $33.91 a share. One could also buy RAX off strength once it clears those breakout levels with volume and then simply use a stop that sits a conformable percentage from your entry point. I would add to either position once RX takes out $43.16 a share with heavy upside volume. To see more breakout candidates, check out the Breakout Stocks of the Week portfolio on Stockpickr. -- Written by Roberto Pedone in Madison, Wis.