This is a list of the top breakout stocks to watch today and are worth watching for swing trading and day trading. Breakout stocks are stocks that just broke out from a previous resistance or consolidation area. You can learn how to find breakout stocks and trade them for profit.
Breakout Stock Screener
The breakout stock screener is updated each day after market close and shows the latest breakout stocks today. This list is useful for short term swing traders and day traders to find stocks to watch
and long term investors to find new stocks for their portfolio.
What is a Breakout in Stocks
A breakout in stocks is when a stock rises above the resistance or breakout from the consolidation area of its recent trading range. For instance, a stock has been trading in the range for $8-$10 for the past couple of months. The $8 is the support level, whereas $10 is the resistance. After the stock price rallies above $10, it is considered a breakout stocks.
Sometimes, a stock would make a false breakout only to retrace later. This happens more often when the volume is low on the breakout day. High volume reduces the chance of a false breakout.
Following is a weekly stock chart of the breakout stocks TSLA.
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TSLA was trading under $400 for the past year, and finally made a breakout and closed above $400 for the first time on December of 2019. The breakout was accompanied with an above average volume which is a strong signal.
For traders who went long on this breakout got paid off nicely as the stock had a nice run from $400 to $900 in the following two months. The weekly chart shows the volume kept going higher as the stock made new highs. TSLA has always been a volatile stocks due to the short interest it has. Traders who were shorting the stock were forced to cover and buy back their stocks, which helps to drive the stock even higher in a short period of time.
When the stock reaches $900, both the RSI and MACD indicators are showing weakness which is a signal to sell the stock. RSI was dropping below $70 whereas MACD is also crossing down. Traders who bought the stock at $900 were in for a big surprise when the stock crashed from $900 to $350 due to the Coronavirus before it recovered again. TSLA was a roller coaster stock since the beginner of 2020.
How to Trade Breakout Stocks
One way to trade breakout stocks is to use technical indicators to find out when is a good time for entry and when is the time to get out of a trade.
For swing traders, the main charts to use are daily chart. The use of weekly charts are optional.
For day traders, the main charts to use are intraday charts. Some day traders use daily charts to filter out stocks that they don't like.
Let's look at the following daily chart for GNUS
The GNUS stock made a breakout 3 times in May, each time supported by huge volume. The RSI and MACD indicator are also showing positive signals during the breakout day. The stop loss should be placed below the breakout price. To trade stocks under $1, your stop loss must be a little wider than usual because a 10 cents move could mean a 15% gain or loss. Beginners should stay away from stocks under $5 because it requires discipline when the trade is not working out.
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How to Find Breakout Stocks
This page shows a list of breakout stocks based on the price and volume and recently trading activities. There are many ways you can find breakout stocks with our stock screener.
Trending Stocks Screener - the trending stock screener shows a list of trending stocks.
Momentum Stocks Screener - scan for a stocks that are gaining mometum
Gap Up Stock Screener - scans for a list of stocks that gaped up today.
52 Week High Stock Screener - scans for stocks that are making 52 week highs.
Breakout Penny Stocks
Penny stocks are not included in this breakout stocks list. If you are interested in breakout penny stocks, use top penny stocks.