These Five (5) Stocks Are Prime for Big Breakouts
By: Stock Center
Category: Stocks
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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, then it’s free to find new buyers and momentum players who can ultimately push the stock significantly higher.

Breakout candidates are something that I tweet about on a daily basis. These are also the exact type of stocks that I love to trade and alert to my subscribers in real-time.

I frequently flag 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.

Pioneer Energy Services

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One energy player that’s starting to spike within range of triggering a big breakout trade is Pioneer Energy Services (PES) , which provides land-based drilling and production services to oil and gas exploration and production companies in the U.S. and Colombia. This stock has been on fire over the last six months, with shares exploding higher by 200%.

If you take a look at the chart for Pioneer Energy Services, you’ll notice that this stock ripped sharply higher on Thursday right off its 20-day moving average of $3.38 a share with strong upside volume flows. Volume for that trading session registered over 1.40 million shares, which is well above its three-month average action of 1.03 million shares. This high-volume spike to the upside is now quickly pushing shares of Pioneer Energy Services within range of triggering a near-term breakout trade.

Traders should now look for long-biased trades in Pioneer Energy Services if it manages to break out above Thursday’s intraday high of $3.80 a share and then above its 50-day moving average of $3.97 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 1.03 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 levels at $4.40 to around $5 a share.

Traders can look to buy Pioneer Energy Services off weakness to anticipate that breakout and simply use a stop that sits right around its 20-day moving average of $3.38 a share or near more support at $3.21 a share. One can also buy this stock 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.

Civeo

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A business services player that’s starting to move within range of triggering a big breakout trade is Civeo (CVEO) , which provides remote site accommodation, logistics and facility management services to the natural resource industry in Australia, Canada and the U.S. This stock has been in play with the bulls over the last six months, with shares ripping higher by 65.8%.

If you take a glance at the chart for Civeo, you’ll notice that this stock recently formed a double bottom chart pattern, after shares found some buying interest over the last month at $1.26 to $1.28 a share. Following that potential bottom, shares of Civeo have now started to trend back above its 20-day moving average of $1.37 a share, and it’s quickly moving within range of triggering a big breakout trade above some near-term overhead resistance levels.

Traders should now look for long-biased trade in Civeo if it manages to break out above some near-term overhead resistance levels at $1.50 to its 200-day moving average of $1.51 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 1.06 million shares. If that breakout takes hold 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 $1.66 to $1.70, or even $1.96 to $2.11 a share.

Traders can look to buy Civeo off weakness to anticipate that breakout and simply use a stop that sits right below its 20-day moving average of $1.37 a share or near those recent double bottom support levels. One could also buy this stock off strength once it starts to move above those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.

Methanex

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Another stock that’s starting to trend within range of triggering a near-term breakout trade is Methanex (MEOH) , which produces and supplies methanol in the Asia Pacific, North America, Europe and South America. This stock has been under modest selling pressure over the last three months, with shares down by 4.3%.

If you take a glance at the chart of Methanex, you’ll notice that this stock recently formed a double bottom chart pattern over the last two months, after shares found some buying interest at $26.91 to $26.83 a share. Following that potential bottom, this stock has now started to uptrend a bit and move back above its 20-day moving average of $28.40 a share. That move is now starting to push shares of Methanex within range of triggering a near-term breakout trade above some key overhead resistance levels.

Traders should now look for long-biased trades in Methanex if it manages to break out above its 50-day moving average of $29.16 a share and then above more near-term overhead resistance levels at $29.77 to $30.22 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 709,977 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 its 200-day moving average of $31.41 to $31.83, or even $32.28 to $34 a share.

Traders can look to buy Methanex off weakness to anticipate that breakout and simply use a stop that sits right below its 20-day moving average of $28.40 a share or around $27.50 a share. One can also buy this stock off strength once it starts to move above those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.

California Resources

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Another stock that’s starting to spike within range of triggering a big breakout trade is California Resources (CRC) , which operates as an oil and natural gas exploration and production company in California. This stock has been red hot over the last six months, with shares exploding higher by 256%.

If you take a glance at the chart for California Resources, you’ll notice that this stock ripped sharply higher on Thursday right above its 50-day moving average of $12.49 a share with decent upside volume flows. This stock has been uptrending over the last few weeks, with shares moving higher off its low of $8.79 a share to its intraday high on Thursday of $13.63 a share. During that uptrend, shares of California Resources have been making mostly higher lows and higher highs, which is bullish technical price action. This spike higher on Thursday is now quickly pushing 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 California Resources if it manages to break out above some near-term overhead resistance levels at $13.63 to $14 a share and then above more resistance levels at $15.18 to $15.44 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 3.39 million shares. If that breakout materializes soon, then this stock will set up to re-test or possibly take out its next major overhead resistance levels at its 200-day moving average of $17.63 to $20 a share.

Traders can look to buy California Resources off weakness to anticipate that breakout and simply use a stop that sits right below its 50-day moving average of $12.49 a share or near its 20-day moving average of $11.15 a share. One can also buy this stock 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.

Southwestern Energy

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My final breakout trading prospect is independent natural gas and oil player Southwestern Energy (SWN) , which explores for, develops, and produces natural gas and oil primarily in the U.S. This stock has been in play with the bulls over the last six months, with shares soaring higher by 69.3%.

If you look at the chart for Southwestern Energy, you’ll notice that this stock has been consolidating and trending sideways over the last two months, with shares moving between $12.54 a share on the downside and $14.85 a share on the upside. Shares of Southwestern Energy spiked notably higher on Thursday back above its 20-day moving average of $14.11 a share with decent upside volume flows. That spike is now quickly pushing this stock within range of triggering a near-term breakout trade above the upper-end of its recent sideways trending chart pattern.

Traders should now look for long-biased trades in Southwestern Energy if it manages to break out above some near-term overhead resistance levels at $14.50 to $14.85 a share with volume that hits near or above its three-month average action of 15.44 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 levels at $15.45 to its 52-week high of $17.35, or even $20 a share.

Traders can look to buy shares of Southwestern Energy off weakness to anticipate that breakout and simply use a stop that sits right around its 50-day moving average of $13.56 a share or near more key support levels at $13.23 to $12.54 a 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 conformable percentage from your entry point.