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, it's free to find new buyers and momentum players which can ultimately push the stock significantly higher.
Breakout candidates are ones that I tweet about on a daily basis. These are also the exact type of stocks I love to trade and alert.
I frequently flag high-probability setups, which are breakout plays and stocks that are acting technically bullish. These are the ones that often make monster moves to the upside. What's great about breakout trading is that you only focus on trends, price and volume. You don't have to concern yourself with anything else. The charts do all the talking.
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.
One biopharmaceutical player that's starting to spike within range of triggering a near-term breakout trade is Sarepta Therapeutics (SRPT) , which focuses on the discovery and development of RNA-based therapeutics for the treatment of rare, infectious, and other diseases.
If you take a look at the chart for Sarepta Therapeutics, you'll notice that this stock recently formed a double bottom chart pattern, after shares found some buying interest at $26.66 to $26.26 a share over the last two months.
Traders should now look for long-biased trades in Sarepta Therapeutics if it manages to break out above its 200-day moving average of $31.36 a share and then above resistance at $32.50 a share with high volume. Look for a sustained trend above those levels with volume that hits near or above its three-month average of 2.43 million shares. If that breakout hits, then this stock could re-test or take out its next major resistance levels at $35 to $40 a share.