DELAFIELD, Wis. (Stockpickr) -- There isn't a day that goes by on Wall Street when certain stocks trading for $10 a share or less don't experience massive spikes higher. Traders savvy enough to follow the low-priced names and trade them with discipline and sound risk management are banking ridiculous coin on a regular basis.
Just take a look at some of the hot movers in the under-$10 complex from Wednesday, including Jakks Pacific (JAKK), which soared higher by 25%; Career Education (CECO), which jumped higher by 15%; Vicor (VICR), which ripped higher by 13.8%; and Immunomedics (IMMU), which spiked higher by 12.2%. You don't even have to catch the entire move in lower-priced stocks such as these to make outsized returns when trading.
One low-priced stock that recently soared higher was biopharmaceutical player Pain Therapeutics (PTIE), which I highlighted in Oct. 11's "5 Stocks Ready to Break Out" at $2.80 per share. I mentioned in that piece that shares of Pain Therapeutics had formed a major bottoming pattern, since the stock was finding buying interest each time it pulled back to around $2.50 a share. Shares of PTIE were then starting to spike higher and challenge both its 50-day and 200-day moving averages. That move was quickly pushing shares of PTIE within range of triggering a major breakout trade above some near-term overhead resistance at $3.05 a share.
Guess what happened? Shares of Pain Therapeutics didn't wait long to trigger that breakout, since the stock explode to the upside on October 17 with heavy upside volume. Then on October 22, shares of PTIE exploded again with monster upside volume, and the stock hit an intraday high of $4.24 a share. That represents a monster gain of over 50% in just two weeks for anyone who bought this stock and played the technical breakout.
Low-priced stocks are something that I tweet about on a regular basis. 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.
I'm not as eager to recommend investing long-term in stocks that trade less than $10 a share because these names can be very speculative, and the odds for picking the long-term winners aren't great. But I definitely love to trade stocks that are priced below $10. I like to view them as a trading vehicle with lots of volatility and lots of upside when the trade is timed right.
When I trade under-$10 names, I do it almost entirely based off of the charts and technical analysis. I also like to find under-$10 names 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.
Ariad Pharmaceuticals
One under-$10 biopharmaceutical player that's just starting to enter breakout territory is Ariad Pharmaceuticals (ARIA), which is engaged in the discovery and development of breakthrough medicines to treat cancers by regulating cell signaling with small molecules. This stock has been crushed by the sellers so far in 2013, with shares down huge by 82%.
If you take a look at the chart for Ariad Pharmaceuticals, you'll notice that this stock has gapped down big over the last month, with the first gap sending the stock from around $19 to $4 a share with massive downside volume. The second gap sent ARIA from $4.50 to its recent low of $2.62 a share with big downside volume. Since hitting that $2.62 low, shares of ARIA have now started to rebound off oversold territory, since its current relative strength index reading is 17.92. That move is starting to push shares of ARIA into breakout territory, since the stock is flirting with some near-term overhead resistance at $3.27 today.
Traders should now look for long-biased trades in ARIA if it manages to take out some near-term overhead resistance at $3.27 and once it clears Thursday's intraday high of $3.38 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 8.03 million shares. If we get that move soon, then ARIA will set up to re-fill some of that second gap down zone that started at $4.53 a share. Shares of ARIA could easily tag its next major overhead resistance level at $5.98 a share if that gap gets filled with strong upside volume flows.
Traders can look to buy ARIA off any weakness to anticipate that breakout and simply use a stop that sits right below some key near-term support at $3.01 a share. One can also buy ARIA off strength once it clears those resistance levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.
Merge Healthcare
Another stock that's starting to move within range of triggering a breakout trade is Merge Healthcare (MRGE), which develops software solutions that facilitate the sharing of images to create a more effective and efficient electronic health care experience for patients and physicians. This stock hasn't done much in 2013, with shares up just over 8% so far.
If you take a look at the chart for Merge Healthcare, you'll notice that this stock has been trending sideways since it gapped down in August, with shares moving between $2.35 on the downside and $2.98 on the upside. Shares of MRGE are now starting to trend back above its 50-day moving average of $2.65 a share. That move is quickly pushing the stock within range of triggering a big breakout trade above the upper end of its sideways trading chart pattern.
Market players should now look for long-biased trades in MRGE if it manages to break out above some near-term overhead resistance levels at $2.82 to $2.98 a share, and then once it takes out its 200-day moving average at $3.08 and its gap down day high of $3.20 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 o 793,997 shares. If we get that move soon, then MRGE will set up to re-fill some of its previous gap down zone from August that started at $4.60 a share.
Traders can look to buy MRGE off any weakness to anticipate that breakout and simply use a stop that sits right below some key near-term support levels at $2.55 to $2.54 a share, or below that recent low of $2.35 a share. One can also buy MRGE off strength once it clears those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.
Tower Group International
One under-$10 financial player that's starting to trend within range of triggering a near-term breakout trade is Tower Group International (TWGP), which underwrites insurance and reinsurance products in Bermuda, the U.S., and London markets. This stock has been destroyed by the bears so far in 2013, with shares off huge by 77%.
If you take a look at the chart for Tower Group International, you'll notice that this stock has been downtrending badly over the last three months, with shares plunging lower from its high of $22.04 to its recent low of $3.71 a share. During that downtrend, shares of TWGP have been consistently making lower highs and lower lows, which is bearish technical price action. That said, shares of TWGP have recently formed a double bottom chart pattern at $3.71 to $3.75 a share, and it's starting to move within range of triggering a near-term breakout trade.
Traders should now look for long-biased trades in TWGP if it manages to break out above some near-term overhead resistance at $4.05 a share with high volume. Look for a sustained move or close above that level with volume that hits near or above its three-month average action of 2.51 million shares. If that breakout triggers soon, then TWGP will set up to re-test or possibly take out its next major overhead resistance levels at $4.53 to $4.54 a share. Any high-volume move above those levels will then give TWGP a chance to trend well north of $5 a share.
Traders can look to buy TWGP off any weakness to anticipate that breakout and simply use a stop that sits right below those double bottom support areas at $3.75 to $3.71 a share. One can also buy TWGP off strength once it clears resistance at $4.05 a share with volume and then simply use a stop that sits a comfortable percentage from your entry point.
Wendy's
Another under-$10 stock that's starting to move within range of triggering a major breakout trade is Wendy's (WEN), which operates quick-service restaurants specializing in hamburger sandwiches throughout the U.S. This stock has been on fire so far in 2013, with shares up sharply by 57%.
If you take a look at the chart for Wendy's, you'll notice that this stock has been trending sideways and consolidating for the last two months, with shares moving between $8.11 on the downside and $8.88 on the upside. This consolidation has been occurring just above WEN's 50-day moving average of $8.23 a share. Shares of WEN are now starting to spike higher and move within range of triggering a major breakout trade above the upper-end of its recent range.
Market players should now look for long-biased trades in WEN if it manages to break out above its 52-week high at $8.88 a share with high volume. Look for a sustained move or close above that level with volume that hits near or above its three-month average action of 6.61 million shares. If that breakout hits soon, then WEN will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets of that breakout are $12 to $15 a share.
Traders can look to buy WEN off weakness to anticipate that breakout and simply use a stop that sits right below its 50-day moving average at $8.23 a share, or below more support at $8.11 a share. One can also buy WEN off strength once it clears its 52-week high at $8.88 a share with volume and then simply use a stop that sits a comfortable percentage from your entry point.
Noranda Aluminum
One final under-$10 stock that looks poised for higher prices is Noranda Aluminum (NOR), a North American integrated producer of value-added primary aluminum products and high-quality rolled aluminum coils. This stock has been hammered by the sellers, since shares of are off sharply by 54% so far in 2013.
If you take a look at the chart for Noranda Aluminum, you'll notice that this stock has been downtrending badly for the last five months, with shares plunging lower from its high of $4.23 to its recent low of $2.21 a share. During that downtrend, shares of NOR have been consistently making lower highs and lower lows, which is bearish technical price action. That said, shares of NOR have recently started to rebound off that $2.21 low, and the stock has pushed back above its 50-day moving average of $2.66 a share. That move is quickly pushing the stock within range of triggering a near-term breakout trade.
Traders should now look for long-biased trades in NOR if it manages to break out above some near-term overhead resistance at $2.82 a share with high volume. Look for a sustained move or close above that level with volume that hits near or above its three-month average action of 442,823 shares. If that breakout triggers soon, then NOR will set up to re-test or possibly take out its next major overhead resistance levels at $3.20 to $3.48 a share. Any high-volume move above those levels will then give NOR a chance to tag its 200-day moving average at $3.80 a share.
Traders can look to buy NOR off weakness to anticipate that breakout and simply use a stop that sits right below some near-term support levels at $2.55 to $2.40 a share. One can also buy NOR off strength once it clears $2.82 a share with volume and then simply use a stop that sits a comfortable percentage from your entry point.
To see more hot under-$10 equities, check out the Stocks Under $10 Setting Up to Explode portfolio on Stockpickr.
-- Written by Roberto Pedone in Delafield, Wis.
Tasos Katopodis/Getty ImagesKmart is just one of several major retailers opening on Thanksgiving to the dismay of worker advocates and some consumers. A lot has been made about the fact that several major retailers will be opening their doors on Thanksgiving to holiday shoppers. Many have complained that this special day should be reserved for family -- not shopping. Facebook (FB) pages have popped up encouraging people to boycott Thanksgiving Day sales. And petitions have been started on Change.org to stop stores from opening on Thursday. Yet, more than one-third of consumers said they are certain that they will shop at Thanksgiving sales, according to a Georgetown Institute for Consumer Research survey. And a RetailMeNot.com survey found that about 20 percent of consumers said that Thanksgiving sales will give people a fun family activity to do on that day and will give shoppers who have to work on Black Friday the opportunity to get great deals. So, clearly, there are differences of opinion. If you're on the fence, though, here are several things you should consider:
If you've never heard of Indo Global Exchanges PteLtd, don't worry - you're not alone. The company only came into existence (in the form we know it today) a few months ago. You'll also not likely hear about it as an investor/consumer here in North America either, so the likes of E TRADE Financial, TD Ameritrade Holding, and Charles Schwab have little to worry about in the way of new competition... yet, anyway. That's because IGEX is taking aim at the Indonesian market, bringing an impressive stock-trading platform to a country and locale that has nothing like that at all.
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Alamy Planning for how you'll make ends meet when you stop earning a paycheck remains a huge challenge for millions of Americans nearing retirement. Yet despite the many concerns that a recent study of 45- to 65-year-olds revealed, taking some simple steps can help you feel a lot more confident about your own retirement prospects. A study from Jackson National Life and the center for Financial Insight solicited opinions from more than 500 people between the age of 45 and 65. Let's take a look at some of the most interesting findings the study revealed and some simple steps you can take to resolve the concerns they raise. Can't Stop 'Til You Get Enough It's not surprising that for those within 20 years of retirement, saving enough to retire was the primary financial concern. About three-quarters of those surveyed chose saving enough for retirement as their biggest fear, with long-term care expenses and broader health-care concerns finishing a distant second and third respectively. Considering that those surveyed were people with at least $200,000 available to invest, some might be surprised to learn that even those who've done a much better than average job of setting money aside for their retirement years are nevertheless squarely focused on getting in even better shape. That said, overconfidence can also pose a threat. Of those surveyed, more than half said they were in good financial shape with no obstacles between them and their goals. With the stock market at record highs, many of those investors may have forgotten just how quickly their retirement prospects deteriorated during the 2008-2009 bear market, when stocks lost more than half their value in just over a year and crushed many portfolios. The solution: Make sure that you have an extra cash cushion above what you think you'll need to retire comfortably, so that no matter what happens in the markets, you can weather the storm without having to sell out at an inopportune time. Social Security: Not to Be Trusted As you approach retirement, one increasingly important issue will be how generous your monthly Social Security benefits will be. Considering the dire predictions about Social Security's ability to keep making full benefit payments in the long run, it's no surprise that survey respondents were skeptical about the program's role in their overall financial prospects. But there's no question the program is vital: Social Security is what separates 40 percent of Americans 65 and over from poverty. But among the comparatively well-situated people surveyed, almost two-thirds believe that Social Security won't be a significant source of retirement income for them. Instead, they expect it will end up being a small supplement to income from other sources. Even among those who were less well-heeled and foresaw Social Security as a major part of their income in retirement, few expect Social Security to allow them to retire comfortably -- if at all. The Social Security Trust Fund is indeed on uncertain ground, especially for those who won't start taking benefits for another 10 to 20 years. By 2033 (or sooner), if nothing changes, benefits will have to be cut by around 25 percent. The ideal scenario will be to have saved enough that you can treat Social Security as a bonus rather than a necessary component of your retirement income. Alternatively, though, deferring benefits until a later age or using more complex strategies can help stretch what Social Security benefits you do receive as far as they'll go. Couples: Making Money Decisions Together Much of the advice you'll find regarding retirement decisions treats the subject like an individual choice. Yet for couples, coordinating financial planning can be a huge challenge, especially when disparities in age and investing experience exist. The survey found that although 44 percent of all men surveyed said they have primary responsibility for financial decisions, only 12 percent of women agreed with that sentiment, with much of the difference coming from more women than men believing that the couple makes its money decisions jointly. There's no single right way for couples to coordinate financial planning. The biggest danger, though, is when one person gives up oversight regarding the family finances to the other, a move that often results in them not knowing the basics of where their money is, how much they have, or how it's invested. If a spouse or significant other has always handled money issues for you, you need to spend at least some time getting familiar with the basic strategies governing your household's finances, what is invested where, and whom you can turn to for help if something happens to your spouse. Don't Let Fear Stop You Perhaps the best news from the survey is that despite concerns about not knowing enough about their money, do-it-yourself investing is gaining in popularity, with more than two of every five men and three of every 10 women participating in it. With so many online-research resources at your disposal, learning some basic retirement investing techniques doesn't have to be difficult -- and it can go a long way toward easing your fears about how to deal with money after you retire. Not only does it have a Florida-like climate, but Tennessee also boasts the second lowest cost of living in the country. Combined with a low tax burden and great access to medical care, Tennessee is ideal for retirees living on fixed incomes, Kahn said. The only downside: the state has one of the country's highest crime rates.
The Institute for the Fiduciary Standard, in its comment filed today by Knut Rostad (right), concludes that “The SEC is poised to neuter the fiduciary standard. The RFI assumptions categorically reject basic fiduciary principles and, instead, set out the basis for a lower commercial sales standard. If the SEC proceeds to embody these assumptions in rulemaking, it would reject decades of precedent, research findings and expert opinion.” 
Individuals of note who have filed comments with the SEC on the issue include John Bogle (left), who said, “What today's 'new' mutual fund industry needs, more than anything else, is a clear affirmation of the fiduciary standard that was specified in the 1940 Acts.” 
Although I also understand the reluctance to impose unnecessary and potentially costly regulatory standards, I believe that this framing, focused on protecting existing business models instead of protecting the public, results in a myopic focus that will leave the investing public at a significant disadvantage.
However, disclosure of financial interest will take on increased importance if brokers and dually registered advisors are deemed to be fiduciaries…retail customers of brokers, dealers and dually registered investment advisers suffer a critical disadvantage in the advisory relationship because the broker-dealer or dually registered adviser is under no obligation to disclose his/her “financial interest” in the securities and insurance transactions1 that the customer enters into as a result of the advice received.
I understand that SEC is looking for data and information on this topic, but I am afraid such data and information are largely kept by entities which do not wish to be regulated by the Dodd-Frank Act. I personally know several elderly people (including some family members) who lost 50% of their savings in 2008 by holding concentrated equity-only portfolios, which had been recommended by their brokers. These elderly people consider themselves still in the middle class but in reality, they are broke and depend on their children's financial supports. The brokers they used were their friends or friends' relatives or friends' friends. It is clear that they knew nothing about the difference between the brokers and investment advisors or fiduciary duties. After they lost almost half of the retirement savings, they were told by the broker/friends that they could still sell their houses to meet their spending requirements, which was hard to do for the people in their 80s. It is clear that (1) public education about fiduciary duties is lacking and (2) more training about fiduciary duties is required for anyone who claim to be a financial advisor. Current disclosure rules on incentive fees do not sufficiently address the conflict of interests of certain type of financial advisors either.