5 Stocks Poised for Breakouts
Market players should now look for long-biased traders in TSLA if this stock can manage to trigger a bigger breakout trade above some overhead resistance levels at $34.50 to $34.68 a share, and then above $35.75 a share with high-volume. Look for a sustained move or close above those levels with volume that's near or above its three-month average action of 1.2 million shares. If we get that action soon, then TSLA will have a great chance of re-testing and possibly taking out its recent highs of $38.47 to $39.95 a share.
One could buy TSLA off weakness to anticipate that breakout and simply use a stop just below the recent breakout level of $32.80 a share. If you buy off weakness, then I would add once TSLA clears those breakout levels mentioned above with high-volume. A higher probability trade would be to buy off strength once TSLA triggers that breakout, and then simply use a stop a few percentage points below $34.50 a share.
This stock is a favorite among the short-sellers. The current short interest as a percentage of the float for TSLA is a whopping 48.6%. This stock has some gigantic short-squeeze potential off any high-volume breakout. With that many shorts, TSLA could see some monster spikes higher if the stock can manage to clear some of those overhead resistance levels. Synthetic Biologics
One name in the biotechnology and drugs complex that's flirting with a major breakout trade is Synthetic Biologics (SYN) , which is focused on the development of synthetic deoxyribonucleic acid (DNA)-based therapeutics and disease-modifying medicines for serious illnesses. This stock is off to a slow start in 2012, with shares off by around 10% so far.
If you look at the chart for Synthetic Biologics, you'll see that this stock formed a perfect triple bottom chart pattern just a few weeks ago at around $1.71 to $1.77 a share. Following that bottom, shares of SYN blasted off its 50-day moving average to its current price of around $2.30 a share. During that sharp spike higher, the upside volume for SYN has been tracking in very strong. A number of recent up days have registered volume between 125,000 to 264,000 shares, which is well above its three-month average action of 70,048 shares.