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.
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Just take a look at some of the big movers to the upside in the under-$10 complex from Wednesday, including Sino-Global Shipping America (SINO) which soared by 178.1%; Recon Technology (RCON), which ripped higher by 83.8%; Voltari(VLTC), which soared by 65.1%; and Lucas Energy (LEI), which spiked by 55.3%. 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 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.
Aspen Aerogels
One under-$10 industrial goods player that's starting to spike within of triggering a big breakout trade is Aspen Aerogels (ASPN), which designs, develops, manufactures, and sells aerogel insulation products used primarily in energy infrastructure facilities worldwide. This stock has been hit noticeably by the sellers over the last six months, with shares dropping sharply by 12%.
If you take a glance at the chart for Aspen Aerogels, you'll notice that this stock recently gapped-down sharply lower from around $6 a share to $3.60 a share with heavy downside volume flows. Following that move, shares of Aspen Aerogels have now formed a double bottom chart pattern, since the stock has found some buying interest at $3.61 to $3.67 a share. This stock has now started to rebound off those support levels, and it's quickly trending 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 Aspen Aerogels if it manages to break out above some near-term overhead resistance levels at $4.17 to $4.25 a share with high volume. Look for a sustained move or close above those levels with volume that registers near or above its three-month average action of 78,988 shares. If that breakout hits soon, then this stock will set up to re-fill some of its previous gap-down-day zone that started near $6 a share. Some possible upside targets if this stock gets into that gap with volume are its 200-day moving average of $4.73 a share or its 20-day moving average of $5.09 a share.
Traders can look to buy this stock off weakness to anticipate that breakout and simply use a stop that sits right around those recent double bottom support levels. One can also buy shares of Aspen Aerogels 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.
Marinus Pharmaceuticals
Another under-$10 clinical stage biopharmaceutical player that's starting to trend within range of a major breakout trade is Marinus Pharmaceuticals (MRNS), which focuses on developing and commercializing therapeutics to treat epilepsy and neuropsychiatric disorders. This stock has been destroyed by the bears over the last six months, with shares collapsing by 75.1%.
If you take a look at the chart for Marinus Pharmaceuticals, you'll notice that this stock recently formed a double bottom chart pattern, after shares found some buying interest at $1.02 to $1.09 a share over the last few weeks. This potential double bottom is coming after shares of Marinus Pharmaceuticals down trended badly over the last two months, with the stock collapsing off its high of $2.73 a share to its new 52-week low of $1.02 a share. This stock has now started to find some buying interest near those double bottom support levels, and it's beginning to trend within range of triggering a major breakout trade above some key overhead resistance levels.
Market players should now look for long-biased trades in Marinus Pharmaceuticals if it manages to break out above some near-term overhead resistance levels at $1.16 to its 20-day moving average of $1.19 a share and then above more resistance levels at $1.25 to $1.28 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 762,812 shares. If that breakout triggers 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 $1.50 a share to $1.55, or even $1.75 to $2 a share.
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Traders can look to buy this stock off weakness to anticipate that breakout and simply use a stop that sits right around those recent double bottom support levels. One can also buy shares of Marinus Pharmaceuticals off strength once it starts to take out those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.
RXi Pharmaceuticals
One under-$10 biotechnology player that's starting to spike within range of triggering a big breakout trade is RXi Pharmaceuticals (RXII), which focuses on discovering and developing therapies primarily in the areas of dermatology and ophthalmology. This stock has been smashed lower by the sellers over the last six months, with shares off sharply by 39.9%.
If you take a glance at the chart for RXi Pharmaceuticals, you'll notice that this stock has been uptrending notably over the last few weeks, with shares moving higher off its recent low of $1 a share to its intraday high on Thursday of $1.33 a share. During that uptrend, shares of RXi Pharmaceuticals have been making mostly higher lows and higher highs, which is bullish technical price action. That uptrend has now pushed this stock within range of triggering a big breakout trade above some key overhead resistance levels.
Traders should now look for long-biased trades in RXi Pharmaceuticals if it manages to break out above some near-term overhead resistance levels at $1.33 to $1.40 a share with volume that registers near or above its three-month average action of 40,366 shares. If that breakout triggers 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 $1.52 a share to $1.70, or even $1.95 to $2 a share.
Traders can look to buy this stock off weakness to anticipate that breakout and simply use a stop that sits right around some near-term support levels at its 20-day moving average of $1.15 a share to $1.10 to $1 a share. One can also buy shares of RXi Pharmaceuticals 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.
Catalyst Biosciences
Another under-$10 clinical stage biopharmaceutical player that's starting to trend within range of triggering a major breakout trade is Catalyst Biosciences (CBIO), which focuses on engineering proteases as therapeutics for hemophilia, hemeostasis, complement-mediated diseases, and other unmet medical needs. This stock has been in a negative trend over the last six months, with shares falling sharply by 46.8%.
If you look at the chart for Catalyst Biosciences, you'll notice that this stock recently formed a double bottom chart pattern, after shares found some buying interest at 62 to 68 cents per share over the last few weeks. This potential bottom is coming after a wicked downtrend for shares of Catalyst Biosciences, that saw the stock fall sharply off its September high of $1.41 a share to its recent low of 62 cents per share. This stock has now started to rebound off that 62 cents low, and it's beginning to trend within range of triggering a major breakout trade.
Market players should now look for long-biased trades in Catalyst Biosciences if it manages to break out above its 20-day moving average of 73 cents per share and then above some more key resistance levels at 77 to 81 cents per 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 70,365 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 90 cents to its 50-day moving average of $1 a share, or even $1.05 to $1.20 a share.
Traders can look to buy Catalyst Biosciences off weakness to anticipate that breakout and simply use a stop that sits right below some key near-term support levels at 68 to 62 cents per share. One can also buy this stock 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.
Cempra
One final under-$10 clinical stage pharmaceutical player that's starting to spike within range of triggering a big breakout trade is Cempra (CEMP), which focuses on developing antibiotics to meet medical needs in the treatment of bacterial infectious diseases in North America. This stock has been under heavy selling pressure over the last six months, with shares off sharply by 54%.
If you take a glance at the chart for Cempra, you'll notice that this stock has been uptrending some over the last few weeks, with shares moving higher off its new 52-week low of $5.70 a share to its recent high of $7.50 a share. During that uptrend, this stock has been making mostly higher lows and higher highs, which is bullish technical price action. That uptrend is coming after a serious of large gaps lower for Cempra, that saw the stock fall big from its October high of $24.50 a share.
The recent strength off the lows for shares of Cempra are now starting to push this stock within range of triggering a major breakout trade above some key near-term overhead resistance levels, and also potentially off extremely oversold levels.
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Traders should now look for long-biased trades in Cempra if it manages to break out above some key near-term overhead resistance levels at $6.85 to $7.50 a share
Traders should now look for long-biased trades in Cempra if it manages to break out above some key near-term overhead resistance levels at $6.85 to $7.50 a share with high volume. Look for a sustained move or close above those levels with volume that registers near or above its three-month average action of 1.81 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 level at around $9.50 a share.
Traders can look to buy shares of Cempra off weakness to anticipate that breakout and simply use a stop that sits right around some key near-term support levels at $6.10 to $5.70 a share. One can also buy this stock off strength once it starts to trend back above those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.
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