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 Stocks Under $10 in Breakout Territory One example of a successful breakout trade I flagged recently was photovoltaic energy player Sunedison ( SUNE), which I featured in Sept. 20's " 5 Stocks Ready to Break Out" at around $7.90 a share. I mentioned in that piece that shares of SUNE had formed a double bottom chart pattern at $7.08 to $7.13 a share. Following that bottom, shares of SUNE were starting to spike higher and move within range of triggering a breakout trade above some key near-term overhead resistance levels at $8.35 to $8.41 a share. Guess what happened? Shares of SUNE started to flirt with those breakout levels in early October as the stock tagged $8.52 and then $9.10 a share. All of the pullbacks off those levels were bought, and SUNE has continued to soar higher with the stock tagging an intraday high today of $11.98 a share. That represents a monster gain of 50% from that $7.90 price level the stock was trading at in my original article. Breakouts like this are a beautiful thing to see, since shares of SUNE maintained a perfect uptrending chart pattern once it started to take those key resistance levels out. >>5 Stocks With Big Insider Buying 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 Stocks Set to Soar on Bullish Earnings With that in mind, here's a look at five stocks that are setting up to break out and trade higher from current levels.
Twitter and become a fan on Facebook.