November trading is kicking off with a less than auspicious start: the S&P 500 gave back almost 2% of its value in October, following a pair of virtually flat months in August and September. In short, it hasn't been the best three-month stretch to be a stock market investor.
That's the bad news.
The good news is that the tide could finally be turning - November is typically a bullish month for stocks, and that's particularly true during months where the lead-up was flat or negative. In fact, studies show that November has historically kicked off the strongest stretch of market performance since 1950, with the S&P generating the majority of its annual returns during the November through April timeframe.
So, with seasonality finally putting the wind at investors' backs, it makes sense to stack the deck in your favor by loading up on stocks that are teetering on the edge of breakout territory right now. To find them, we're turning to the charts for a technical look at five stocks that are showing off attractive breakout setups.
In case you're unfamiliar with technical analysis, here's the executive summary: technical analysis is a way for investors to quantify qualitative factors, such as investor psychology, based on a stock's price action and trends. Once the domain of cloistered trading teams on Wall Street, technicals can help top traders make consistently profitable trades and can aid fundamental investors in better planning their stock execution.
Without further ado, here's a rundown of five technical setups that are showing solid upside potential right now...
InterXion Holding NV
Leading off our list of potential breakout movers is $2.7 billion European datacenter services operator InterXion Holding NV (INXN) . This stock has been a leader since the start of 2016, rallying more than 23% since the calendar flipped to January. But don't worry if you've missed that upside move so far - InterXion is on the verge of a breakout that could kick off a second leg higher this fall...
InterXion is currently forming a textbook example of an ascending triangle setup. The ascending triangle is a bullish continuation pattern that's formed by horizontal resistance up above shares at $39, and uptrending support to the downside. Basically, as this stock bounces in between those two technically significant price levels, it's been getting squeezed closer and closer to a breakout through that $39 price ceiling. When that happens, we've got a buy signal.
Relative strength, the indicator down at the bottom of InterXion's price chart, is the additional piece of evidence for the breakout that investors should be paying attention to here. Our relative strength line, with measures this stock's outperformance versus the rest of the broad market, has been in a well-defined uptrend all year long - as long as that uptrend in relative strength remains intact, this stock is predisposed to keep on outperforming.
Wait for shares to catch a bid above $39 before you pull the trigger on this trade...