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.
Xenoport (XNPT), a biopharmaceutical company, focuses on developing and commercializing a portfolio of internally discovered product candidates for the treatment of neurological and other disorders. This stock closed up 3.3% to $3.66 in Thursday's trading session.
Thursday's Range: $3.45-$3.82
52-Week Range: $3.15-$7.20
Thursday's Volume: 647,000
Three-Month Average Volume: 501,428
From a technical perspective, XNPT spiked notably higher here right above some near-term support at $3.25 with above-average volume. This stock has been downtrending badly for the last four months and change, with shares moving lower from its high of $7.20 to its recent 52-week low of $3.15. During that downtrend, shares of XNPT have been consistently making lower highs and lower lows, which is bearish technical price action. That said, shares of XNPT have now started to rebound off that $3.15 low and it's starting to trend within range of triggering a near-term breakout trade. That trade will hit if XNPT manages to take out some key near-term overhead resistance levels at $3.86 to $4 with high volume.
Traders should now look for long-biased trades in XNPT as long as it's trending above support at $3.25 or above its 52-week low of $3.15 and then once it sustains a move or close above those breakout levels with volume that hits near or above 501,428 shares. If that breakout triggers soon, then XNPT will set up to re-test or possibly take out its next major overhead resistance levels at $4.25 to $4.50, or even its 50-day moving average of $4.75. Any high-volume move above those levels will then give XNPT a chance to tag $5.24 to its 200-day moving average of $5.34.