DELAFIELD, Wis. (Stockpickr) -- Trading stocks that trigger major breakouts can lead to massive profits. Once a stock trends to a new high or takes out a prior overhead resistance point, then it's free to find new buyers and momentum players who can ultimately push the stock significantly higher.

Breakout candidates are something that I tweet about on a daily basis. I frequently tweet out high-probability setups, breakout plays and stocks that are acting technically bullish. These are the stocks that often go on to make monster moves to the upside. What's great about breakout trading is that you focus on trend, price and volume. You don't have to concern yourself with anything else. The charts do all the talking.

Trading breakouts is not a new game on Wall Street. This strategy has been mastered by legendary traders such as William O'Neal, Stan Weinstein and Nicolas Darvas. These pros know that once a stock starts to break out above past resistance levels and hold above those breakout prices, then it can easily trend significantly higher.

With that in mind, here's a look at five stocks that are setting up to break out and possibly trade higher from current levels.

Flexsteel Industries

One stock that's starting to trend within range of triggering a near-term breakout trade is Flexsteel Industries  (FLXS - Get Report) , which manufactures, imports and markets residential and commercial upholstered and wood furniture products in the U.S. This stock has been under selling pressure over the last three months, with shares off by 26%.

If you take a look at the chart Flexsteel Industries you'll notice that this stock ripped sharply higher on Thursday back above its 20-day moving average of $30.15 a share with decent upside volume flows. You'll also notice that shares of Flexsteel Industries have been making higher lows over the past month and change, following a big drop off its July high of close to $45 a share. This strong spike to the upside on Thursday is now quickly pushing this stock within range of triggering a near-term breakout trade.

Traders should now look for long-biased trades in Flexsteel Industries if it manages to break out above some near-term overhead resistance levels at $32.05 to $32.30 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 37,169 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 its 200-day moving average of $34.15 to its 50-day moving average of $35.34, or even $38 a share.

Traders can look to buy Flexsteel Industries off weakness to anticipate that breakout and simply use a stop that sits right around its 20-day moving average of $30.15 or around $29 to $28.50 a share. One can also buy this stock 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.

ResMed

A health care stock that's starting to spike within range of triggering a near-term breakout trade is ResMed  (RMD - Get Report) , which develops, manufactures, distributes, and markets medical equipment for the diagnosis, treatment and management of respiratory disorders with a focus on sleep-disordered breathing. This stock has been hit hard by the sellers over the last six months, with shares off sharply by 27.4%.

If you take a glance at the chart for ResMed, you'll notice that this stock has been consolidating and trending sideways over the last month and change, with shares moving between $48.99 on the downside and $52.73 on the upside. Shares of ResMed ripped higher on Thursday back above its 20-day moving average of $51.13 with above-average volume. That high-volume move to the upside is now quickly pushing this stock within range of triggering a near-term breakout trade above the upper-end of its recent sideways trending chart pattern.

Traders should now look for long-biased trades in ResMed if it manages to break out above some near-term overhead resistance levels at $51.90 to $52.43 a share and then above more resistance at $52.73 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 845,853 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 its 50-day moving average of $53.43 to $55.74, or even $58.50 to its 200-day moving average of $59.83 a share.

Traders can look to buy ResMed off weakness to anticipate that breakout and simply use a stop that sits right around some key near-term support levels at $49.22 to that recent low of $48.99 a share. One could also buy this stock 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.

Amedisys


Another health care stock that's starting to move within range of triggering a near-term breakout trade is Amedisys  (AMED - Get Report) , which provides home health and hospice care services. This stock has been trending very strong over the last six months, with shares sharply higher by 53.3%.

If you take a glance at the chart for Amedisys, you'll notice that this stock has been uptrending decent over the last month and change, with shares moving higher from its low of $36.31 to its recent high of $43.63 a share. During that utprend, shares of Amedisys have been making mostly higher lows and higher highs, which is bullish technical price action. This stock has now started to spike higher over the last few trading sessions right off its 20-day moving average of $40.85 a share. That spike is now quickly pushing shares of Amedisys within range of triggering a near-term breakout trade above some key overhead resistance levels.

Traders should now look for long-biased trades in Amedisys if it manages to break out above some near-term overhead resistance levels at its 50-day moving average of $42.61 a share and then above more key resistance levels at $43.08 to around $44 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 397,309 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 $46 to its 52-week high of $48.34 a share. Any high-volume move above those levels will then give this stock a chance to tag or trend north of $50 a share.

Traders can look to buy Amedisys off weakness to anticipate that breakout and simply use a stop that sits right around its 20-day moving average of $40.85 to around more near-term support at $39.50 a share. One can also buy this stock 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.


Bitauto


A technology stock that's quickly moving within range of triggering a big breakout trade is Bitauto  (BITA - Get Report) , which provides Internet content and marketing services for the automotive industry in the People's Republic of China. This stock has been smacked lower by the bears over the last three months, with shares down large by 51.7%.

If you take a glance at the chart for Bitauto, you'll notice that this stock has been consolidating and trending sideways over the last month or so, with shares moving between $22 on the downside and $27.86 on the upside. This sideways chart pattern has taken hold after a massive decline in this stock, which saw shares of Bitauto plunge off its May high of $67.37 to that recent low of $22 a share. This stock jumped higher on Thursday back above its 20-day moving average of $26.30 a share. That spike is now quickly pushing shares of Bitauto within range of triggering a big breakout trade above the upper-end of its recent sideways trending chart pattern.

Traders should now look for long-biased trades in Bitauto if it manages to break out above some near-term overhead resistance levels at $27.54 to $27.86 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 943,451 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 $30 to $31.01, or even its 50-day moving average of $31.77 to $35 a share.

Traders can look to buy Bitauto off weakness to anticipate that breakout and simply use a stop that sits right around some key near-term support at $24.27 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.

Fibrocell Science

My final breakout trading prospect is autologous cell therapy player Fibrocell Science  (FCSC) , which focuses on developing treatments for skin and connective tissue diseases with unmet medical needs. This stock has been trending strong over the last six months, with shares notably higher by 22.6%.

If you look at the chart for Fibrocell Science, you'll notice that this stock has been uptrending strong over the last month and change, with shares moving higher from its low of $4.93 to its recent high of $6.75 a share. During that uptrend, shares of Fibrocell Science have been making mostly higher lows and higher highs, which is bullish technical price action. This stock spiked sharply higher on Thursday right off its 20-day moving average of $5.95 a share and back above its 50-day moving average of $6.16 a share with decent upside volume flows. That move is now quickly pushing this stock within range of triggering a major breakout trade above some key near-term overhead resistance levels.

Traders should now look for long-biased trades in Fibrocell Science if it manages to break out above some near-term overhead resistance levels at $6.75 to $6.85 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 319,236 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 $7.21 to its 52-week high of $7.60 a share. Any high-volume move above those levels will then give this stock a chance to tag its next major overhead resistance levels at $8.75 to $10 a share.

Traders can look to buy shares of Fibrocell Science off weakness to anticipate that breakout and simply use a stop that sits right around some key near-term support at $5.80 a share. One can also buy this stock off strength once it starts to move above those breakout levels with volume and then simply use a stop that sits a conformable 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.