DELAFIELD, Wis. ( 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.>>5 Cash-Hoarders to Triple Your Gains One example of a successful breakout trade that I flagged recently was Chinese mobile application player Sky-mobi ( MBOI), which I featured in Sept. 27's " 5 Stocks Poised for Breakouts" at around $3.74 a share. I mentioned in that piece that shares of MOBI recently formed a triple-bottom chart pattern at $3.31, $3.28 and $3.40 a share. After forming that bottom, shares of MOBI started to uptrend and challenge its 50-day moving average of $3.76 a share. That move was pushing MOBI within range of triggering a breakout trade above some near-term overhead resistance levels at $3.71 to $3.83 a share. Guess what happened? Shares of MOBI triggered that breakout on Wednesday with monster upside volume. This stock soared to its intraday high on Wednesday of $4.59 a share, which represents a gain of just over 20% for anyone who played the breakout. Shares of MOBI still look poised for higher prices, and traders should now look to play the next breakout trade which will trigger if resistance at $4.59 to $4.96 a share gets taken out with volume. >>5 Stocks Under $10 Set to Soar Breakout candidates are something that I tweet about on a daily basis. I frequently tweet out high-probability setups, breakout plays and stocks that are acting technically bullish. These are the stocks 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 hold above those breakout prices, then it can easily trend significantly higher. >>5 Big Trades to Take Now 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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