5 Breakout Stocks: Must-See Charts
An example of a recent successful breakout trade is alternative energy player Solazyme
Guess what happened? Shares of SZYM triggered that breakout a few trading sessions later with monster upside volume. This stock went on to run to its recent high of $9.90 a share, which was tagged on December 14. That's a big gain in a very short timeframe for anyone that took that trade. The best part about this trade is that volume showed up to confirm that large buyers were moving into the stock once it broke out. Volume isn't always necessary for a breakout trade, but it raises the probability of success when we get it.
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 trade higher from current levels.