Stocks that are making large moves like these are favorites among short-term traders because they can jump into these names and try to capture some of that massive volatility. Stocks that are making big-percentage moves either up or down are usually in play because their sector is becoming attractive or they have a major fundamental catalyst such as a recent earnings release. Sometimes stocks making big moves have been hit with an analyst upgrade or an analyst downgrade.
Regardless of the reason behind it, when a stock makes a large-percentage move, it is often just the start of a new major trend -- a trend that can lead to huge profits. If you time your trade correctly, combining technical indicators with fundamental trends, discipline and sound money management, you will be well on your way to investment success.
With that in mind, let's take a closer look at a several stocks under $10 that are making large moves to the upside.
Gastar Exploration (GST), an independent energy company, is engaged in the exploration, development and production of oil, condensate, natural gas and natural gas liquids in the U.S. This stock closed up 5.4% to $6.62 in Tuesday's trading session.
Tuesday's Range: $6.30-$6.82
52-Week Range: $2.17-$7.13
Tuesday's Volume: 1.26 million
Three-Month Average Volume: 1.01 million
From a technical perspective, GST spiked sharply higher here right above its 50-day moving average of $6.15 with above-average volume. This move is quickly pushing shares of GST within range of triggering a major breakout trade. That trade will hit if GST manages to take out some near-term overhead resistance levels at $6.85 to its 52-week high at $7.13 with high volume.
Traders should now look for long-biased trades in GST as long as it's trending above its 50-day at $6.15 or above more near-term support at $5.93 and then once it sustains a move or close above those breakout levels with volume that hits near or above 1.01 million shares. If that breakout hits soon, then GST will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $8 to $9.