Stock Quotes in this Article: ONXX, QSII, DWRE

MILWAUKEE (Stockpickr) -- As a day trader or swing trader, being in the right stocks at the right time can have a big impact on profit and losses. But with limited computer screen space, how do you decide what to watch to make the most bang for your buck?

One of the things I like to do is set alerts for when a stock is nearing a key level. This way I can catch a stock in a favorable setup when it occurs.

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One favorable setup I like to look for is when stocks are breaking out. A breakout occurs when a stock goes through resistance levels, which are areas where the stock has been held down by sellers in the past. Typically when a stock breaks through a resistance level, buyers and momentum players come in and push the stock higher.

Here are three breakout stock plays to watch.

Onyx Pharmaceuticals

Onyx Pharmaceuticals (ONXX) is one example of a stock nearing a breakout. The stock is trading near highs but struggling to hold above $92. Look for this to possibly break out on large volume as it looks to retest highs.

I’ll likely have an alert set for $92 to see if the momentum is there to push it higher.

Quality Systems

Another stock to watch for a possible breakout to the upside is Quality Systems (QSII), which has recently been beaten down and gapped down a considerable amount in July. It has since been trading in a channel. With a breakout at $20, momentum should carry this stock higher. Likewise, if it breaks $16, it could start trending lower.

By the time one of these scenarios does occur, you will probably have forgotten all about the stock. This is where setting alerts comes in handy so you don’t miss the opportunity when it comes knocking. Set your alerts for $16 and $20.


My final breakout stock today has already broken out. Demandware (DWRE) broke out of a tight channel last Thursday. Although it broke out, it certainly has potential to move higher from these levels as momentum players and a new round of buyers come in.

-- Written by Andrew Anger in Milwaukee.

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

Andrew Anger, based out of Milwaukee, is a proprietary trader, focused on technical analysis in mid- to large-cap stocks.  He graduated in 2012 from Saint Mary's University of Minnesota with a degree in marketing entrepreneurship. You can follow him on twitter @angertrader.