3 Biotech Stocks Under $10 to Trade for Breakouts

DELAFIELD, Wis. (Stockpickr) – As part of a daily routine as an active trader or investor, one should always be tracking the stocks in the market that are making the biggest percentage gains and the biggest percentage losses.

Stocks that are making large moves to the upside 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 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.



Cleveland BioLabs

Cleveland BioLabs  (CBLI), a biopharmaceutical company, focuses on developing pharmaceuticals designed to address diseases with unmet medical needs. This stock is trading up 9.8% to $2.12 in Tuesday's trading session.

Tuesday's Range: $1.91-$2.20
52-Week Range: $1.84-$13.80
Tuesday's Volume: 67,000
Three-Month Average Volume: 68,688

From a technical perspective, CBLI is ripping sharply higher here and bucking the overall market weakness with decent upside volume flows. This sharp spike to the upside for CBLI is coming right above some near-term support at $1.84, which also happens to be CBLI's new 52-week low. Shares of CBLI are now starting to trend within range of triggering a major breakout trade above some near-term overhead resistance levels. That trade will hit if CBLI manages to take out some key near-term overhead resistance levels at $2.40 to $2.50 with high volume.

Traders should now look for long-biased trades in CBLI as long as it's trending above its new 52-week low of $1.84 and then once it sustains a move or close above those breakout levels with volume that hits near or above 68,688 shares. If that breakout materializes soon, then CBLI will set up to re-test or possibly take out its next major overhead resistance levels at $3 to its 50-day moving average of $3.05, or even $3.30.

Durect

Durect  (DRRX), a specialty pharmaceutical company, focuses on the development of pharmaceuticals products based on its proprietary drug formulations and delivery platform technologies in the U.S., Europe, Japan and internationally. This stock is trading up 6.5% to $2.60 in Tuesday's trading session.

Tuesday's Range: $2.39-$2.60
52-Week Range: $1.97-$13.12
Tuesday's Volume: 602,000
Three-Month Average Volume: 851,877

From a technical perspective, DRRX is ripping sharply higher here right above some near-term support at $2.20 with decent upside volume flows. This spike to the upside on Tuesday has now started to push shares of DRRX into breakout territory, since the stock has either cleared or tested some near-term resistance levels at $2.60 to $2.65. Market players should now look for a continuation move to the upside in the short-term if DRRX manages to take out Tuesday's intraday high of $2.67 and then above some past resistance at around $2.70 with high volume.

Traders should now look for long-biased trades in DRRX as long as it's trending above $2.40 or above some key near-term support at $2.20 and then once it sustains a move or close above $2.67 to $2.70 with volume that registers near or above 851,877 shares. If that move gets underway soon, then DRRX will set up to re-test or possibly take out its next major overhead resistance levels at $3 to $3.25, or even $3.50.

Galena Biopharma

Galena Biopharma  (GALE), a biopharmaceutical company, focuses on developing and commercializing oncology therapeutics that address major unmet medical needs across cancer care. This stock is trading up 2.9% to $1.40 in Tuesday's trading session.

Tuesday's Range: $1.36-$1.41
52-Week Range: $1.27-$3.58
Tuesday's Volume: 1.72 million
Three-Month Average Volume: 2.81 million

From a technical perspective, GALE is trending higher here back above its 50-day moving average of $1.39 with decent upside volume flows. This stock recently formed a double bottom chart pattern at $1.27 to $1.28 a share. This move higher on Tuesday has now started to push shares of GALE within range of triggering a near-term breakout trade above some key overhead resistance levels. That trade will hit if GALE manages to take out some key near-term overhead resistance levels at $1.40 to $1.48 with high volume.

Traders should now look for long-biased trades in GALE as long as it’s trending above some near-term support levels at $1.35 to $1.30 and then once it sustains a move or close above those breakout levels with volume that hits near or above 2.81 million shares. If that breakout kicks off soon, then GALE will set up to re-test or possibly take out its next major overhead resistance at $1.55. Any high-volume move above $1.55 will then give GALE a chance to re-fill some of its previous gap-down-day zone from March that stared near $1.80.

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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