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.

Celldex Therapeutics

One biopharmaceutical stock that's starting to trend within range of triggering a near-term breakout trade is Celldex Therapeutics  (CLDX - Get Report) , which develops, manufactures and commercializes novel therapeutics for human health care in the U.S. This stock has been smacked lower by the bears over the last three months, with shares off sharply by 51.6%.

If you take a look at the chart Celldex Therapeutics, you'll see that this stock has been downtrending badly over the last four months and change, with shares plunging lower off its high of $29.94 to its new 52-week low of $10.11 a share. During that downtrend, shares of Celldex Therapeutics have been making mostly lower highs and lower lows, which is bearish technical price action. That said, this stock has now started to spike a bit higher off that $10.11 low and it's now quickly moving within range of triggering a near-term breakout trade.

Traders should now look for long-biased trades in Celldex Therapeutics if it manages to break out above some near-term overhead resistance levels at $12.18 to $12.41 a share and then above its 20-day moving average of $13.08 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 1.79 million shares. If that breakout triggers soon, then this stock will set up to re-test or possibly take out its next major overhead resistance levels at $13.50 to $14, or even its 50-day moving average of $15.44 to $16 a share. Any high-volume move over $16 will then give this stock a chance to make a run into its previous gap-down-day zone from August that started near $22 a share.

Traders can look to buy Celldex Therapeutics off weakness to anticipate that breakout and simply use a stop that sits right around $11 a share or near its new 52-week low of $10.11 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.

Aegerion Pharmaceuticals


Another biopharmaceutical stock that's starting to spike within range of triggering a big breakout trade is Aegerion Pharmaceuticals  (AEGR) , which develops and commercializes therapies for patients with debilitating rare diseases in the U.S. This stock has been hit hard by the sellers over the last six months, with shares off large by 44.9%.

If you take a glance at the chart for Aegerion Pharmaceuticals, you'll notice that this stock ripped sharply higher on Thursday right above its new 52-week low of $12.76 a share with strong upside volume flows. Volume on Thursday registered over 940,000 shares, which is well above its three-month average action of 565,878 shares. That high-volume spike to the upside is now quickly pushing shares of Aegerion Pharmaceuticals within range of triggering a big breakout trade above some key near-term overhead resistance levels.

Traders should now look for long-biased trades in Aegerion Pharmaceuticals if it manages to break out above some near-term overhead resistance levels at $14.40 to $15 a share and then above its 20-day moving average of $15.53 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 565,878 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 50-day moving average of 17.05 to $18.30, or even $19.20 to $20 a share.

Traders can look to buy Aegerion Pharmaceuticals off weakness to anticipate that breakout and simply use a stop that sits right around its new 52-week low of $12.76 a share. One could also buy this stock 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.

Zynerba Pharmaceuticals


Another specialty pharmaceutical player that's starting to move within range of triggering a near-term breakout trade is Zynerba Pharmaceuticals  (ZYNE - Get Report) , which focuses on developing and commercializing proprietary synthetic cannabinoid therapeutics formulated for transdermal delivery. This stock has been destroyed by the sellers over the last month, with shares off big by 44.3%.

If you take a glance at the chart for Zynerba Pharmaceuticals, you'll notice that this stock has been downtrending badly over the last two months and change, with shares collapsing off its high of $43 to its new all-time low of $12 a share. During that plunge, shares of Zynerba Pharmaceuticals have been consistently making lower highs and lower lows, which is bearish technical price action. That said, this stock has now started to spike higher off that $12 low and it's quickly moving within range of triggering a near-term breakout trade above some key overhead resistance levels.

Traders should now look for long-biased trades in Zynerba Pharmaceuticals if it manages to break out above some near-term overhead resistance levels at $14.75 to $15 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 185,222 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 20-day moving average of $16.75 to $17.50, or even $19 to $20 a share. Any high-volume move above $20 will then give this stock a chance to tag $22.50 to $23.50 a share.

Traders can look to buy Zynerba Pharmaceuticals off weakness to anticipate that breakout and simply use a stop that sits right below some near-term support at $12.50 or right around its all-time low of $12 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.


C&J Energy Services


An energy stock that's quickly moving within range of triggering a big breakout trade is C&J Energy Services  (CJES) , which provides completion and production services for oil and gas industry primarily in North America. This stock has been smashed lower by the sellers over the last six months, with shares down big by 58%.

If you take a glance at the chart for C&J Energy Services, you'll see that this stock has been uptrending strong with big volume over the last few weeks, with shares moving higher off its low of $3.26 to its recent high of $5.47 a share. During that move, shares of C&J Energy Services have been consistently making higher lows and higher highs, which is bullish technical price action. That move has also pushed this stock back above its 20-day moving average and its moved it into breakout territory above a number of key near-term overhead resistance levels. Shares of C&J Energy Services are now quickly trending within range of triggering a much bigger breakout trade above some key overhead resistance levels.

Traders should now look for long-biased trades in C&J Energy Services if it manages to break out above its 50-day moving average of $5.42 a share and then once it clears some key resistance levels at $5.47 to $5.55 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 3.08 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 $7 to $8, or even $9 a share.

Traders can look to buy C&J Energy Services off weakness to anticipate that breakout and simply use a stop that sits right around some near-term support at $4.60 a share, or just below its 20-day moving average of $4.29 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 comfortable percentage from your entry point.

Zogenix


My final breakout trading prospect is pharmaceutical player Zogenix  (ZGNX - Get Report) , which develops and commercializes therapies for the treatment of central nervous system disorders in the U.S. This stock has been jammed by the sellers over the last month, with shares down large by 35.2%.

If you look at the chart for Zogenix, you'll notice that this stock has been downtrending badly over the last month and change, with shares collapsing off its high of $21.03 to its recent low of $12.10 a share. During that downtrend, shares of Zogenix have been consistently making lower highs and lower lows, which is bearish technical price action. That said, this stock has now attempted to carve out a double bottom chart pattern, since shares have found some buying interest over the last few weeks at $12.20 to $12.10 a share. This stock has now started to trend higher off those support levels and it's quickly moving within range of triggering a big breakout trade above some near-term overhead resistance levels.

Traders should now look for long-biased trades in Zogenix if it manages to break out above some near-term overhead resistance levels at $13.43 to its 200-day moving average of $13.78 a share and then once it clears more key resistance levels at $14 to $14.25 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 644,822 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 its 20-day moving average of $15.84 to $17, or even its 50-day moving average of $17.64 to around $18 a share.

Traders can look to buy shares of Zogenix off weakness to anticipate that breakout and simply use a stop that sits right below some key near-term support levels at $12.10 to $12 a share. One can 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 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.