5 Stocks Under $10 Set to Soar

 DELAFIELD, Wis. (Stockpickr) --  There isn't a day that goes by on Wall Street when certain stocks trading for less than $10 a share don't experience massive spikes higher. Traders savvy enough to follow the low-priced names and trade them with discipline and sound risk management are banking ridiculous coin on a regular basis.

Just take a look at some of the big movers in the under-$10 complex from Wednesday, including AirMedia Group  (AMCN), which ripped to the upside by 38.5%; QLK Stores (QKLS), which spiked higher by 38.3%; Gerui Advanced Materials Group  (CHOP), which soared higher by 34.4%; and Rock Creek Pharmaceutical  (RCPI), which trended sharply higher by 29.1%. You don't even have to catch the entire move in lower-priced stocks such as these to make outsized returns when trading.

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.

iBio


One under-$10 biotechnology stock that's quickly moving within range of triggering a major breakout trade is iBio  (IBIO), which focuses on the commercialization of its proprietary plant-based protein expression technologies in the U.S. and internationally. This stock has been performing strong over the last three months, with shares moving sharply to the upside by 54%.

If you take a glance at the chart for iBio, you'll see that this stock is forming a very tight coiled consolidation chart pattern, with shares basically trending back and forth over the last few weeks between 70 cents on the downside and 82 cents on the upside. Shares of IBIO have just started to flirt with a key downtrend line that dates back to mid-February, and that move is quickly pushing the stock within range of triggering a major breakout trade.

Market players should now look for long-biased trades in IBIO if it manages to break out above that key downtrend and that move will trigger over some near-term overhead resistance levels at 80 to 82 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 1.63 million shares. If that breakout hits soon, then IBIO will set up to re-test or possibly take out its next major overhead resistance levels at 89 cents per share to $1 a share, or even $1.08 to $1.32 a share.

Traders can look to buy IBIO off weakness to anticipate that breakout and simply use a stop that sits right below some key near-term support levels at 72 to 70 cents per share. One can also buy IBIO off strength once it starts to take out those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.

NQ Mobile

Another under-$10 stock that's quickly trending within range of triggering a big breakout trade is NQ Mobile  (NQ), which provides mobile Internet services in the People's Republic of China and internationally. This stock has been destroyed by the bears over the last six months, with shares getting slammed lower by 43%.

If you take a look at the chart for NQ Mobile, you'll notice that this stock spiked sharply higher on Wednesday right above some near-term support at $3.70 a share and basically off its 50-day moving average of $3.81 a share with heavy upside volume flows. Volume on the day registered 3.99 million shares, which is well above its three-month average action of 1.13 million shares. This high-volume rip to the upside is now quickly pushing shares of NQ within range of triggering a major breakout trade above a key downtrend line that dates back to the start of this year.

Market players should now look for long-biased trades in NQ if it manages to break out above that downtrend line which will trigger over some near-term overhead resistance levels at $4.10 to $4.17 a share and then above $4.31 to $4.35 a 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 1.13 million shares. If that breakout materializes soon, then NQ will set up to re-test or possibly take out its next major overhead resistance levels at $4.73 to $5.08 a share, or even $5.50 to $6 a share.

Traders can look to buy NQ off weakness to anticipate that breakout and simply use a stop that sits just below some key near-term support levels at $3.70 to $3.60 a share, or at $3.42 a share. One can also buy NQ 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.

Glu Mobile

One under-$10 multimedia and graphics software stock that's starting to trend within range of triggering a big breakout trade is Glu Mobile  (GLUU), which develops, publishes and markets a portfolio of games for the smartphones and tablet devices users. This stock has been trending strong over the last three months, with shares soaring to the upside by 33.6%.

If you take a glance at the chart for Glu Mobile, you'll notice that this stock recently formed a double bottom chart pattern at $4.57 to $4.66 a share. That bottom took place right above both of GLUU's 50-day and 200-day moving averages. Since that bottom, shares of GLUU have been trending to the upside and now the stock is starting to move within range of triggering a major breakout trade above a key downtrend line. That downtrend line has acted as resistance for the stock since last August.

Traders should now look for long-biased trades in GLUU if it manages to break out above that important downtrend line that will trigger over some near-term overhead resistance levels at $5.25 to $5.34 a share and then above $5.50 to $5.65 a share with high volume. Look for a sustained move or close above those levels with volume that registers near or above its three-month average action of 2.65 million shares. If that breakout develops soon, then GLUU will set up to re-test or possibly take out its next major overhead resistance level at around $6.25 a share. Any high-volume move above $6.25 will then give GLUU a chance to re-fill its previous gap-down-day zone from last July that started at $7 a share.

Traders can look to buy GLUU off weakness to anticipate that breakout and simply use a stop that sits right around its 50-day moving average of $4.79 a share or near its 200-day moving average of $4.71 a share. One can also buy GLUU off strength once it starts to bust above those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.

Another under-$10 pre-production stage player that's starting to trend within range of triggering a near-term breakout trade is Uni-Pixel  (UNXL), which engages in developing performance engineered film (PEF) products for the display, touch screen and flexible electronics market segments in the U.S. This stock has been moving sharply to the upside over the last six months, with shares higher by a notable 26.7%.

If you look at the chart for Uni-Pixel, you'll see that this stock has been consolidating and trending sideways over the last month, with shares moving between $6.22 a share on the downside and $7.55 a share on the upside. Shares of UNXL bounced higher on Wednesday right above both its 200-day moving average of $6.33 and above its range low of $6.22 a share as well as its 50-day moving average of $6.10 a share. That bounce is now quickly pushing shares of UNXL within range of triggering a near-term breakout trade above some key overhead resistance levels.

Market players should now look for long-biased trades in UNXL if it manages to break out above some near-term overhead resistance levels at $7.25 to $7.55 a 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 volume of 117,897 shares. If that breakout gets started soon, then UNXL will set up to re-test or possibly take out its next major overhead resistance levels at $8 to $8.24 a share, or even $8.80 to its 52-week high of $9.30 a share.

Traders can look to buy UNXL off weakness to anticipate that breakout and simply use a stop that sits right below either its 200-day at $6.33 or its 50-day at $6.10 a share. One can also buy UNXL off strength once it starts to trend above those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.

Vimicro International


One final under-$10 technology stock that's starting to trend within range of triggering a near-term breakout trade is Vimicro International  (VIMC), which provides video surveillance solution and video processors in Mainland China, Hong Kong and the U.S. This stock has been moving to the upside over the last three months, with shares spiking sharply higher by 22.9%.

If you take a glance at the chart for Vimicro International, you'll see that this stock ripped sharply higher on Wednesday right above some near-term support at $8.40 a share and back above its 50-day moving average of $8.93 a share with slightly above-average volume. Volume on the day registered over 414,000 shares, which is above its three-month average of 332,013 shares. This jump to the upside is now starting to push shares of VIMC within range of triggering a near-term breakout trade above some key overhead resistance levels.

Traders should now look for long-biased trades in VIMC if it manages to break out above some near-term overhead resistance levels at $9.50 to $9.72 a share and then above more resistance at $10.27 a 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 332,013 shares. If that breakout triggers soon, then VIMC will set up to re-test or possibly take out its next major overhead resistance levels at $11.19 to its 52-week high of $11.79 a share.

Traders can look to buy VIMC off weakness to anticipate that breakout and simply use a stop that sits right below some key near-term support at $8.40 or at $8 a share. One can also buy VIMC off strength once it starts to take out those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.

This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.

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