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 under $10 a share don't experience massive spikes higher. Traders savvy enough to follow the low-priced names and trade them with discipline and sod risk management are banking ridiculous coin on a regular basis.

Just take a look at some of the big movers to the upside in the under-$10 complex from Wednesday, including Wave Systems (WAVX) , which exploded higher by 76.2%; Liquid Holdings (LIQD) , which soared by 59%; Ascent Solar Technologies (ASTI) , which surged higher by 42.3%; and WPCS International (WPCS) , which spiked higher by 26.6%. 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 stocks, I do it almost entirely based off of the charts and technical analysis. I also like to find under-$10 stocks 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.


Ohr Pharmaceuticals


One under-$10 pharmaceutical player that's starting to trend within range of triggering a big breakout trade is Ohr Pharmaceuticals  (OHRP) , which focuses on the development of novel therapeutics and delivery technologies for the treatment of ocular disease. This stock has been destroyed by the sellers over the last six months, with shares down huge by 70%.

If you take a glance at the chart for Ohr Pharmaceuticals, you'll notice that this stock recently formed a double bottom chart pattern at $2.20 to $2.25 a share. Following that bottom, shares of Ohr Pharmaceuticals have ripped higher and started to uptrend strong with the stock moving back above both its 20-day and 50-day moving averages. That strong move to the upside has now pushed this stock within range of triggering a major breakout trade above some key near-term overhead resistance levels.

Market players should now look for long-biased trades in shares of Ohr Pharmaceuticals if it manages to break out above some key near-term overhead resistance levels at $3 to $3.15 a share and then above more resistance at $3.24 to $3.26 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 of 2.15 million shares. If that breakout materializes soon, then this stock will set up to re-test or possibly take out its next major overhead resistance levels at $3.62 to $3.80, or even $4 to $4.34 a share.

Traders can look to buy this stock off weakness to anticipate that breakout and simply use a stop that sits right around some key near-term support levels at 2.70 to its 20-day moving average of $2.59 a share, or around $2.40 a share. One can also buy shares of Ohr Pharmaceuticals 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.

TrueCar


Another under-$10 technology player that's starting to spike within range of triggering a big breakout trade is TrueCar  (TRUE) , which operates as an Internet-based information, technology, and communication services company. This stock has been slammed lower by the sellers over the last six months, with shares down large by 68.5%.

If you take a look at the chart for TrueCar, you'll notice that this stock spiked sharply higher on Wednesday right off its 20-day moving average of $5.46 and right above some more near-term support at $5.56 with decent upside volume flows. This trend to the upside on Wednesday is now quickly pushing shares of True Car within range of triggering a big breakout tradeabove some key near-term overhead resistance levels.

Market players should now look for long-biased trades in TrueCar if it manages to break out above some key near-term overhead resistance at $6.16 a share with high volume. Look for a sustained move or close above that level with volume that hits near or above its three-month average action of 1.66 million shares. If that breakout fires off soon, then this stock will set up to re-test or possibly take out its next major overhead resistance levels at $7.04 to its gap-down-day high from August at $7.44 a share. Any high-volume move above those levels will then give this stock a chance to re-fill some of its previous gap-down-day zone that started above $11 a share.

Traders can look to buy this stock off weakness to anticipate that breakout and simply use a stop that sits right below some key near-term support at around $5.50 a share, or down near $5 a share. One can also buy shares of TrueCar 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.


Stone Energy


One under-$10 energy player that's starting to trend within range of triggering a big breakout trade is Stone Energy  (SGY) , which engages in the acquisition, exploration, exploitation, development, and operation of oil and gas properties in the Gulf of Mexico and the Appalachia region. This stock has been smacked down by the bears over the last six months, with shares off sharply by 69.2%.

If you take a glance at the chart for Stone Energy, you'll notice that this stock has just recently started to rebound sharply higher off its new 52-week low of $3.74 a share with a number of bullish upside volume days. Volume over the last week has seen a number of trading sessions register near or above 4 million shares, which is well above its three-month average volume of 1.70 million shares. Shares of Stone Energy have also ripped higher during that timeframe off is 52-week low of $3.74 to its recent high of $5.75 a share. This high-volume uptrend has now pushed this stock within range of triggering a big breakout trade above some near-term overhead resistance levels.

Traders should now look for long-biased trades in Stone Energy if it manages to break out above some key near-term overhead resistance levels at $5.75 to $6.40 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 of 1.70 million shares. If that breakout hits soon, then this stock will set up to re-test or possibly take out its next major overhead resistance levels at $7.71 to its 50-day moving average of $7.79, or even $8 to $9 a share.

Traders can look to buy this stock off weakness to anticipate that breakout and simply use a stop that sits right below some near-term support at around $4.75 a share. One can also buy shares of Stone Energy 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.


Arbutus Biopharma


Another under-$10 biopharmaceutical player that's starting to spike within range of triggering a near-term breakout trade is Arbutus Biopharma  (ABUS) , which focuses on the research and development of RNA interference therapeutics, and provides lipid nanoparticle delivery technology to pharmaceutical partners in Canada. This stock has been smashed lower by the bears over the last six months, with shares down big by 61%.

If you look at the chart for Arbutus Biopharma, you'll see that this stock has been downtrending badly for the last six months, with shares falling sharply lower from over $20 a share to its new 52-week low of $6.23 a share. During that downtrend, shares of Arbutus Biopharma have been making mostly lower highs and lower lows, which is bearish technical price action. That said, this stock has now started to rebound off that $6.23 low and it's beginning to move within range of triggering a near-term breakout trade.

Market players should now look for long-biased trades in Arbutus Biopharma if it manages to break out above some key near-term overhead resistance levels at $7.20 to $7.57 and then above $8 to its 20-day moving average of $8.06 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 601,289 shares. If that breakout gets started soon, then this stock will set up to re-test or possibly take out its next major overhead resistance levels at $9 to its 50-day moving average of $9.98, or even $10.50 to $11.50 a share.

Traders can look to buy Arbutus Biopharma off weakness to anticipate that breakout and simply use a stop that sits right around some key near-term support levels at $6.67 or near its new 52-week low of $6.23 a share. One can also buy this stock off strength once it starts to spike above those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.

Vivus


One final under-$10 biopharmaceutical player that's starting to trend within range of triggering a big breakout trade is Vivus  (VVUS) , which develops and commercializes therapies to address unmet needs in obesity, sleep apnea, diabetes, and sexual health in the U.S. and the European Union. This stock has been hit hard by the bears over the last three months, with shares down large by 50.2%.

If you take a glance at the chart for Vivus, you'll notice that this stock has been uptrending strong over the last few weeks, with shares moving higher from its low of 94 cents to its intraday high on Wednesday of $1.24 a share. During that uptrend, this stock has been making mostly higher lows and higher highs, which is bullish technical price action. Shares of Vivus ripped higher on Wednesday right off its 20-day moving average of $1.13 with strong upside volume flows. That move is now quickly pushing this stock within range of triggering a big breakout trade.

Traders should now look for long-biased trades in Vivus if it manages to break out above some near-term overhead resistance levels at $1.25 to around $1.30 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 of 1.33 million shares. If that breakout develops soon, then this stock will set up to re-test or possibly take out its next major overhead resistance levels at around $1.40 to $1.60, or even its 50-day moving average of $1.68 to $1.80 a share.

Traders can look to buy Vivus off weakness to anticipate that breakout and simply use a stop that sits right around some near-term support at $1.10 a share. One can also buy this stock 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.

Disclosure: 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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