These 5 Stocks Under $10 Are Set to Soar Higher

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 monster movers to the upside in the under-$10 complex from Wednesday, including Sequenom (SQNM) , which exploded higher by 176%; EPIRUS Biopharmaceuticals (EPRS) , which soared by 103%; Xtera Communications (XCOM) , which ripped higher by 58.4%; and Evoke Pharma (EVOK) , which traded up 29.9%. 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. These are also the exact type of stocks that I love to trade and alert to my subscribers in real-time. 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.

ImmunoGen

One under-$10 biotechnology player that's starting to spike within range of triggering a big breakout trade is ImmunoGen  (IMGN) , which develops targeted anticancer therapeutics. This stock has been slammed lower by the bears over the last six months, with share plunging lower by 42.6%.

If you take a glance at the chart for ImmunoGen, you'll notice that this stock spiked sharply higher on Wednesday right above its new 52-week low of $2.68 a share with decent upside volume flows. This spike pushed this stock right into its 20-day moving average of $2.96 a share, before it closed just below that level at $2.92 a share. This spike to the upside is now quickly pushing shares of ImmunoGen within range of triggering a big breakout trade above some key overhead resistance levels.

Market players should now look for long-biased trades in shares of ImmunoGen if it manages to break out above some near-term overhead resistance levels at its 20-day moving average of $2.96 a share to some key resistance levels at $3.11 to $3.28 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 2.36 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 $3.36 to $3.56, or even its 50-day moving average of $4.02 a share.

Traders can look to buy this stock off weakness to anticipate that breakout and simply use a stop that sits right below its new 52-week low of $2.68 a share. One can also buy shares of ImmunoGen 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.

NantKwest

Another under-$10 biotech stock that's starting to trend within range of triggering a big breakout trade is NantKwest  (NK) , which engages in developing immunotherapeutic agents for various clinical conditions in the U.S. This stock has been smacked lower by the bears over the last six months, with shares falling sharply by 36.1%.

If you take a look at the chart for NantKwest, you'll notice that this stock has been uptrending over the last month and change, with shares moving higher off its low of $5.43 a share to its recent high of $7.17 a share. During that uptrend, this stock has been making mostly higher lows and higher highs, which is bullish technical price action. This strong trend has now pushed shares of NantKwest within range of triggering a big breakout trade above some key near-term overhead resistance levels.

Market players should now look for long-biased trades in NantKwest if it manages to break out above Wednesday's intraday high of $6.92 a share and then once it clears more near-term resistance at $7.17 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 331,479 shares. If that breakout takes hold soon, then this stock will set up to re-test or possibly take out its next major overhead resistance levels at $8 to $8.13, or even $8.50 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 its 20-day moving average of $6.48 a share or around more near-term support at $6 a share. One can also buy shares of NantKwest 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.

Sunrun

An under-$10 semiconductor stock that's starting to trend within range of triggering a near-term breakout trade is Sunrun  (RUN) , which engages in the design, development, installation sale, ownership and maintenance of residential solar energy systems in the U.S. This stock has been destroyed by the sellers over the last six months, with shares off sharply by 48.1%.

If you take a glance at the chart for Sunrun, you'll notice that this stock has been trending sideways and consolidating over the last few weeks, with shares moving between $4.90 on the downside and $5.32 on the upside. Shares of Sunrun have now started to spike higher back above its 20-day moving average of $5.22 a share with decent upside volume flows. That spike 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 Sunrun if it manages to break out above some near-term overhead resistance levels at $5.32 to $5.50 a share with volume that hits near or above its three-month average action of 1.01 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 its 50-day moving average of $5.76 to $5.95, or even $6.40 to $6.70 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 levels at $5 to $4.90 a share. One can also buy shares of Sunrun 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.

Catabasis Pharmaceuticals

Another under-$10 clinical-stage biopharmaceutical player that's starting to trend within range of triggering a major breakout trade is Catabasis Pharmaceuticals  (CATB) , which focuses on the discovery, development and commercialization of therapeutics to treat inflammatory and metabolic diseases. This stock has been hit hard by the sellers over the last six months, with shares falling sharply by 38.4%.

If you look at the chart for Catabasis Pharmaceuticals, you'll notice that this stock has formed a double bottom chart pattern over the last few weeks, with shares finding some buying interest at $3.31 to $3.40 a share. Following that potential bottom, shares of Catabasis Pharmaceuticals have now started to spike higher and trend back above its 20-day moving average of $3.64 a share with decent upside volume flows. This trend is now quickly pushing 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 Catabasis Pharmaceuticals if it manages to break out above some near-term overhead resistance levels at $3.85 to $4 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 33,921 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 $4.40 to its 50-day moving average of $4.62, or even $5 to $5.50 a share.

Traders can look to buy Catabasis Pharmaceuticals off weakness to anticipate that breakout and simply use a stop that sits right below its new 52-week low of $3.31 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.

Papa Murphy's

One final under-$10 stock that's starting to spike within range of triggering a near-term breakout trade is Papa Murphy's  (FRSH) , which together with its subsidiaries, owns, operates and franchises Take N Bake pizza stores. This stock has been under some notable selling pressure over the last six months, with shares down sharply by 24.7%.

If you take a glance at the chart for Papa Murphy's, you'll notice that this stock has been uptrending a bit over the last month or so, with shares moving higher off its low of $6.48 a share to its recent high of $7.80 a share. During that uptrend, this stock has been making mostly higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of Papa Murphy's within range of triggering a near-term breakout trade above some key overhead resistance levels.

Traders should now look for long-biased trades in Papa Murphy's if it manages to break out above its 50-day moving average of $7.28 a share and above some near-term overhead resistance levels at $7.50 to $7.80 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 218,240 shares. If that breakout begins soon, then this stock will set up to re-test or possibly take out its next major overhead resistance levels at $8.33 to $8.70, or even its gap-down-day high from May at $9.50 a share. Any high-volume move above $9.50 will then give this stock a chance to re-fill some of its gap-down-day zone that started near $12.50 a share.

Traders can look to buy shares of Papa Murphy's off weakness to anticipate that breakout and simply use a stop that sits just below some near-term support at $6.98 a share or around its new 52-week low of $6.48 a share. One can 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.

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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