IsoRay

My final idea that could be preparing for an explosive move higher here is IsoRay (ISR), which develops, manufactures, and sells isotope-based medical products and devices for the treatment of cancer and other malignant diseases primarily in the U.S. This stock has been trading strongly to the upside over the last three months, with shares up big by 41%.

If you look at the chart for IsoRay, you'll notice that this stock recently formed a major bottoming chart pattern, after shares of ISR found buying interest over the last month each time it traded down towards 66 to 67 cents per share. So far, those levels have held and now shares of ISR are starting to push within range of triggering a major breakout trade above a key downtrend line.

Traders should now look for long-biased trades in ISR if it manages to break out above some near-term overhead resistance levels at 75 to 78 cents per share with high volume. Look for a sustained move or close above those levels with volume that hits near or above its three-month average action of 940,443 shares. If that breakout hits soon, then ISR will set up to rip sharply higher and potentially tag 90 cents to $1 a share, or even trend north of $1 a share.

Traders can look to buy ISR off any weakness to anticipate that breakout and simply use a stop that sits right below those major support levels at 67 to 66 cents per share. One can also buy ISR off strength once it starts to clear those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.

To see more stocks that could be setting up to skyrocket higher soon, check out the Skyrocket Stock Watchlist portfolio on Stockpickr.

-- Written by Roberto Pedone in Delafield, Wis.

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At the time of publication, author had no positions in stocks mentioned. Roberto Pedone, based out of Delafield, Wis., is an independent trader who focuses on technical analysis for small- and large-cap stocks, options, futures, commodities and currencies. Roberto studied international business at the Milwaukee School of Engineering, and he spent a year overseas studying business in Lubeck, Germany. His work has appeared on financial outlets including CNBC.com and Forbes.com. You can follow Pedone on Twitter at www.twitter.com/zerosum24 or @zerosum24.

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