Delafield, Wis. (Stockpickr) -- Want to make big money fast? Then pay attention to the little guys. Trading stocks under $10 can really pay off -- if you know what you're doing.
Just take a look at some of the big movers in the under-$10 complex from Thursday, including Microvision (MVIS), which is exploding higher by over 70%; Biolase (BIOL), which is soaring higher by 15%; Sky-mobi (MOBI), which is ripping to the upside by 14%; and Lightbridge (LTBR), which is trending up by 13%. You don't even have to catch the entire move in lower-priced stocks such as these to make outsized returns when trading.
One low-priced stock that recently trended sharply higher was technology player American Superconductor (AMSC), which I highlighted in Feb. 13's "5 Stocks Under $10 Set to Soar" at around $1.70 per share. I mentioned in that piece that shares of American Superconductor had recently formed a double bottom chart pattern at $1.37 to $1.43 a share. Following that bottom, shares of AMSC were starting to spike higher back above its 50-day moving average and it was quickly moving within range of triggering a near-term breakout trade above $1.72 to $1.83 a share.
Guess what happened? Shares of American Superconductor didn't wait long to trigger that breakout, since the stock exploded higher on Feb. 18 with strong upside volume flows. Shares of AMSC tagged an intraday high on Wednesday of $2.25 a share in another trading session of strong upside volume. That represents a large gain of 30% for anyone who bought this stock around $1.70 a share in anticipation of that breakout. As you can see, trading low-priced stocks that technically trigger off high-probability setups can lead to big profits and fast.
Low-priced stocks are something that I tweet about on a regular basis. I frequently flag high-probability setups, breakout candidates and low-priced stocks that are acting technically bullish. I like to hunt for low-priced stocks that are showing bullish price and volume trends, since that increases the probability of those stocks heading higher. These setups often produce monster moves higher in very short time frames.
When I trade under-$10 names, I do it almost entirely based off of the charts and technical analysis. I also like to find under-$10 names with a catalyst, but that's secondary to the chart and volume patterns.
With that in mind, here's a look at several under-$10 stocks that look poised to potentially trade higher from current levels.