Stock Quotes in this Article: CECO, EDU, JASO, JKS, SWI

DELAFIELD, Wis. (Stockpickr) -- 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 that can ultimately push the stock significantly higher.

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Breakout candidates are something that I tweet about on a daily basis. I frequently tweet out 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.

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With that in mind, here's a look at five stocks that are setting up to break out and trade higher from current levels.

JA Solar

One stock that's quickly moving within range of triggering a near-term breakout trade is JA Solar (JASO), which designs, manufactures and markets high-performance solar cells made from specially processed silicon wafers. This stock has been in play with the bulls so far in 2013, with shares up 75%.

If you take a look at the chart for JA Solar, you'll notice that this stock has been uptrending for the last few weeks, with shares moving higher from its low of $5.90 to its recent high of $7.62 a share. During that uptrend, shares of JASO have been consistently making higher lows and higher highs, which is bullish technical price action. That move has started to push shares of JASO within range of triggering a near-term breakout trade.

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Traders should now look for long-biased trades in JASO if it manages to break out above some near-term overhead resistance levels at $7.62 to $8.10 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 2.14 million shares. If that breakout triggers soon, then JASO will set up to re-test or possibly take out its next major overhead resistance levels at $10 to its 52-week high at $11.40 a share.

Traders can look to buy JASO off any weakness to anticipate that breakout and simply use a stop that sits right below its 50-day moving average of $6.56 a share. One could also buy JASO off strength once it takes out those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.

SolarWinds

Another stock that looks poised to trigger a near-term breakout trade is SolarWinds (SWI), which designs, develops, markets, sells and supports enterprise-class IT infrastructure management software to IT professionals. This stock has been hit hard by the bears so far in 2013, with shares off by 21%.

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If you take a look at the chart for SolarWinds, you'll notice that this stock has been downtrending badly for the last four months, with shares plunging from its high of $61.52 to its recent low of $37.96 a share. During that downtrend, shares of SWI have been consistently making lower highs and lower lows, which is bearish technical price action. That said, shares of SWI have now started to bounce off that $37.96 low and it's quickly moving within range of triggering a near-term breakout trade. This move could be signaling that the downtrend for SWI is over at least in the short-term.

Market players should now look for long-biased trades in SWI if it manages to break out above some near-term overhead resistance levels at $42.14 to its 50-day moving average at $42.79 a share and then once it takes out more resistance at $43.06 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 1 million shares. If that breakout triggers soon, then SWI will set up to re-test or possibly take out its next major overhead resistance levels at $48.62 to around $52 a share. Any high-volume move above those levels will then put $54 to $56 into range for shares of SWI.

Traders can look to buy SWI off any weakness to anticipate that breakout and simply use a stop that sits right below today's intraday low of $39.38 a share. One could also buy SWI off strength once it takes out those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.

JinkoSolar

Another stock that's quickly moving within range of triggering a major breakout trade is JinkoSolar (JKS), a solar power product manufacturer. This stock has been on fire so far in 2013, with shares up sharply by 58%.

If you look at the chart for JinkoSolar, you'll notice that this stock has been trending sideways for the last month and change, with shares moving between $7.25 on the downside and $10.44 on the upside. Shares of JKS recently pulled back to its 50-day moving average and have now started to rebound off that level and move within range of triggering a breakout trade. That potential breakout would push shares of JKS above the upper end of its sideways trading chart pattern.

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Market players should now look for long-biased trades in JKS if it manages to break out above some near-term overhead resistance levels at $10.21 to $10.25 a share and then once it clears its 52-week high at $10.44 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 656,042 shares. If that breakout triggers soon, then JKS will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $14 to $16 a share.

Traders can look to buy JKS off any weakness to anticipate that breakout and simply use a stop that sits right below some key near-term support at $9 a share. One can also buy JKS off strength once it takes out those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.

New Oriental Education

Another stock that's starting to move within range of triggering a major breakout trade is New Oriental Education (EDU), a provider of private educational services in China based on the number of program offerings, total student enrollments and geographic presence. This stock is off to a decent start so far in 2013, with shares up 16%.

If you look at the chart for New Oriental Education, you'll notice that this stock has been uptrending strong for the last four months, with shares soaring higher from its low of $14.40 a share to its recent high of $23.11 a share. During that move, shares of EDU have been mostly making higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of EDU within range of triggering a major breakout trade.

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Traders should now look for long-biased trades in EDU if it manages to break out above some near-term overhead resistance levels at $22.63 to $23.11 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 volume of 1.96 million shares. If that breakout triggers soon, then EDU will set up to re-test or possibly take out its next major overhead resistance levels at $28 to $28.55 a share. Any high-volume move above those levels will then put $30 to $32 into range for shares of EDU.

Traders can look to buy EDU off any weakness to anticipate that breakout and simply use a stop that sits right below its 50-day moving average at $20.68 a share. One can also buy EDU off strength once it takes out those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.

Career Education

My final breakout trading prospect is Career Education (CECO), which is an on-ground provider of private, for-profit, postsecondary education in the U.S. and also has a presence in online education. This stock has been trending modestly lower so far in 2013, with shares off by 10.6%.

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If you look at the chart for Career Education, you'll notice that this stock has been uptrending decent for the last few weeks, with shares moving higher from its low of $2.55 to its intraday high of $3.20 a share. During that move, shares of CECO have been consistently making higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of CECO within range of triggering a near-term breakout trade.

Traders should now look for long-biased trades in CECO if it manages to break out above some near-term overhead resistance levels at $3.19 to $3.23 a share and then once it takes out more resistance at $3.27 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 839,798 shares. If that breakout triggers soon, then CECO will set up to re-test or possibly take out its next major overhead resistance levels at $4 to $4.22 to $4.34 a share. Any high-volume move above those levels will then put its next major overhead resistance levels at $5 to $6 into range for shares of CECO.

Traders can look to buy CECO off any weakness to anticipate that breakout and simply use a stop that sits right below its 50-day at $2.80 a share. One could also buy CECO off strength once it clears those breakout levels with volume and then simply use a stop that sits a conformable percentage from your entry point.

To see more breakout candidates, check out the Breakout Stocks of the Week portfolio on Stockpickr.

-- Written by Roberto Pedone in Delafield, Wis.

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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.