Thursday, February 6, 2014

3 Stocks Under $10 to Trade for Breakouts

DELAFIELD, Wis. (Stockpickr) -- At Stockpickr, we track daily portfolios of stocks that are the biggest percentage gainers and the biggest percentage losers.

>>5 Stocks Set to Soar on Bullish Earnings

Stocks that are making large moves like these are favorites among short-term traders because they can jump into these names and try to capture some of that massive volatility. Stocks that are making big-percentage moves either up or down are usually in play because their sector is becoming attractive or they have a major fundamental catalyst such as a recent earnings release. Sometimes stocks making big moves have been hit with an analyst upgrade or an analyst downgrade.

Regardless of the reason behind it, when a stock makes a large-percentage move, it is often just the start of a new major trend -- a trend that can lead to huge profits. If you time your trade correctly, combining technical indicators with fundamental trends, discipline and sound money management, you will be well on your way to investment success.

>>5 Low-Priced Stocks to Trade for Gains

With that in mind, let's take a closer look at a several stocks under $10 that are making large moves to the upside.

LightIn TheBox

LightIn TheBox (LITB), through its subsidiaries, operates as an online retailing company. This stock closed up 2.7% to $9.79 a share in Tuesday's trading session.

Tuesday's Range: $9.46-$9.79

52-Week Range: $6.18-$23.38

Tuesday's Volume: 148,000

Three-Month Average Volume: 545,832

From a technical perspective, LITB bounced modestly higher here right above some near-term support at $9 with lighter-than-average volume. This bounce is starting to push shares of LITB within range of triggering a big breakout trade. That trade will hit if LITB manages to take out some key overhead resistance levels at $9.97 to $10.79 and then $10.89 with high volume.

Traders should now look for long-biased trades in LITB as long as it's trending above $9 or above its 50-day at $8.40 and then once it sustains a move or close above those breakout levels with volume that hits near or above 545,832 shares. If that breakout hits soon, then LITB will set up to re-test or possibly take out its next major overhead resistance levels $12 to $13.

Coffee Holding

Coffee Holding (JVA) is engaged in manufacturing, roasting, packaging, marketing and distributing roasted and blended coffees in the U.S., Canada, and the Far East. This stock closed up 7.7% to $5.45 in Tuesday's trading session.

Tuesday's Range: $5.01-$5.50

52-Week Range: $4.50-$7.78

Tuesday's Volume: 169,000

Three-Month Average Volume: 61,955

From a technical perspective, JVA surged sharply higher here right off its 50-day moving average of $5.007 with above-average volume. This move briefly pushed shares of JVA into breakout territory, after the stock flirted with some near-term overhead resistance at $5.46. Shares of JVA tagged an intraday high of $5.50 before closing just below that level at $5.45. Market players should now look for a continuation move higher in the short-term if JVA can manage to take out Tuesday's high of $5.50 with strong volume.

Traders should now look for long-biased trades in JVA as long as it's trending above Tuesday's low of $5.01 and then once it sustains a move or close above $5.50 with volume that hits near or above 61,955 shares. If we get that move soon, then JVA will set up to re-test or possibly take out its next major overhead resistance levels at $5.85 to its 200-day moving average of $5.93. Any high-volume move above those levels will then give JVA a chance to tag $6.20 to $6.60.

1-800-Flowers.com

1-800-Flowers.com (FLWS) operates as a florist and gift retailer in the U.S. This stock closed up 4.3% to $5.30 in Tuesday's trading session.

Tuesday's Range: $5.06-$5.32

52-Week Range: $3.78-$7.17

Thursday's Volume: 323,000

Three-Month Average Volume: 208,510

From a technical perspective, FLWS spiked notably higher here right off its 50-day moving average of $5.09 with above-average volume. This stock has been consolidating and trending sideways for the last four months, with shares moving between $4.53 on the downside and $5.75 on the upside. This spike on Tuesday is starting to push shares of FLWS within range of triggering a breakout trade above the upper-end of its recent sideways trading chart pattern. That trade will hit if FLWS manages to take out Tuesday's high of $5.32 to its 200-day at $5.64 and then once it clears some past overhead resistance at $5.75 with high volume.

Traders should now look for long-biased trades in FLWS as long as it's trending above $5 or above $4.80 and then once it sustains a move or close above those breakout levels with volume that hits near or above 208,510 shares. If that breakout hits soon, then FLWS will set up to re-test or possibly take out its next major overhead resistance levels at $6.20 to $6.50. Any high-volume move above those levels will then give FLWS a chance to tag $7.

To see more stocks that are making notable moves higher, check out the Stocks Under $10 Moving Higher portfolio on Stockpickr.

-- Written by Roberto Pedone in Delafield, Wis.


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>>2 Big Tech Stocks Spiking on Big Volume



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>>3 Huge Stocks to Trade (or Not)

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At the time of publication, author had no positions in stocks mentioned.

Roberto Pedone, based out of Delafield, Wis., is an independent trader who focuses on technical analysis for small- and large-cap stocks, options, futures, commodities and currencies. Roberto studied international business at the Milwaukee School of Engineering, and he spent a year overseas studying business in Lubeck, Germany. His work has appeared on financial outlets including

CNBC.com and Forbes.com.

You can follow Pedone on Twitter at www.twitter.com/zerosum24 or @zerosum24.


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