Stock Quotes in this Article: HXM, IAG, SVM, GPL, AUMN

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.

>>5 Ways to Profit From a Crowded Short Trade

Just take a look at some of the hot movers in the under-$10 complex from Thursday, including James River Coal (JRCC), which is ripping higher by 16%; Bio-Path (BPTH), which is soaring higher by 15.5%; Rentech (RTK), which is ripping to the upside by 13%; and Supercom (SPCB), which is surging to the upside by 12%. You don't even have to catch the entire move in lower-priced stocks such as these to make outsized returns when trading.

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.

>>5 Stocks Insiders Love Right Now

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.

Golden Minerals


One under-$10 basic materials player that's starting to trend within range of triggering a near-term breakout trade is Golden Minerals (AUMN), which is engaged in mining, construction and exploration of mineral properties. It explores for gold, silver, zinc, lead and other minerals. This stock has been on fire so far in 2014, with shares up a whopping 101%.

If you take a glance at the chart for Golden Minerals, you'll see that this stock has been uptrending a bit over the last few weeks, with shares moving higher from its low of 82 cents per share to its intraday high of 96 cents per share. During that uptrend, shares of AUMN have been consistently making higher lows and higher highs, which is bullish technical price action. Shares of AUMN are now starting to push within range of triggering a near-term breakout trade above some key overhead resistance levels.

Traders should now look for long-biased trades in AUMN if it manages to break out above its 50-day moving average at 97 cents per share and then once it takes out more resistance at $1 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 467,932 shares. If that breakout hits soon, then AUMN will set up to re-test or possibly take out its next major overhead resistance levels at $1.14 to $1.28 a share. Any high-volume move above those levels will then give AUMN a chance to tag $1.50 to $1.60 a share.

Traders can look to buy AUMN off weakness to anticipate that breakout and simply use a stop that sits right around some near-term support levels at 85 to 82 cents per share. One can also buy AUMN 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.

Iamgold


Another under-$10 gold mining player that's starting to trend within range of hitting a big breakout trade is Iamgold (IAG), which explores, develops and operates gold mining properties. The company also explores for silver, niobium and copper deposits. This stock is off to a decent start so far in 2014, with shares up by 9.5%.

If you take a look at the chart for Iamgold, you'll notice that this stock recently formed a triple bottom chart pattern at $3.37, $3.41 and $3.42 a share. Following the most recent test of those support levels, shares of IAG have started to uptrend a bit and move within range of triggering a big breakout trade above some key near-term overhead resistance levels.

Market players should now look for long-biased trades in IAG if it manages to break out above some near-term overhead resistance at $3.70 to its 50-day moving average of $3.76 a share and then once it clears more resistance at $3.88 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 6.52 million shares. If that breakout kicks off soon, then IAG will set up to re-test or possibly take out its next major overhead resistance levels at $4.35 to its 200-day moving average of $4.42 a share.

Traders can look to buy IAG off weakness to anticipate that breakout and simply use a stop that sits right below those triple bottom support levels. One can also buy IAG 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.

Great Panther Silver


One under-$10 silver mining player that's starting to move within range of triggering a near-term breakout trade is Great Panther Silver (GPL), which is engaged in the mining of mineral properties in Mexico. The company explores for silver, gold, lead and zinc. This stock is off to a hot start in 2014, with shares up sharply by 53%.

If you consult the chart for Great Panther Silver, you'll see that this stock recently formed a double bottom chart pattern at 99 cents to $1.01 a share. Following that bottom, shares of GPL have started to uptrend and the stock is now flirting with its 50-day moving average at $1.11 a share. That move is quickly pushing shares of GPL within range of triggering a near-term breakout trade above some key overhead resistance.

Traders should now look for long-biased trades in GPL if it manages to break out above its 50-day moving average of $1.11 a share and then once it takes out more near-term overhead resistance at $1.13 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 954,118 shares. If that breakout gets underway soon, then GPL will set up to re-test or possibly take out its next major overhead resistance levels at $1.26 to $1.35 a share, or even its 52-week high at $1.38 a share.

Traders can look to buy GPL off weakness to anticipate that breakout and simply use a stop that sits right around those double bottom support levels. One can also buy GPL off strength once it starts to bust above those key resistance levels volume and then simply use a stop that sits a comfortable percentage from your entry point.

Silvercorp Metals


Another under-$10 silver mining player that's starting to push within range of triggering a big breakout trade is Silvercorp Metals (SVM), which together with its subsidiaries, engages in the acquisition, exploration, development and mining of precious and base metal properties in China and Canada. This stock has been rocked by the bears over the last six months, with shares off by 32%.

If you take a glance at the chart for Silvercorp Metals, you'll notice this stock has been downtrending badly for the last two months, with shares falling sharply from its high of $3.29 to its recent low of $1.87 a share. During that downtrend, shares of SVM have been consistently making lower highs and lower lows, which is bearish technical price action. That said, shares of SVM have started to bounce off that $1.87 low and it's starting to break out above some near-term overhead resistance at $2.03 a share. That move is starting to push shares of SVM within range of triggering an even bigger breakout trade.

Market players should now look for long-biased trades in SVM if it manages to break out above some key near-term overhead resistance levels at $2.15 to $2.20 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 of 1.30 million shares. If that breakout starts soon, then SVM will set up to re-test or possibly take out its next major overhead resistance levels at its 50-day moving average of $2.38 a share to its 200-day moving average of $2.77 a share.

Traders can look to buy SVM off weakness to anticipate that breakout and simply use a stop that sits right below its recent low of $1.87 a share. One can also buy SVM off strength once it starts to clear those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.

Desarrolladora Homex


One final under-$10 residential construction player that's starting to trend within range of triggering a major breakout trade is Desarrolladora Homex (HXM), which is a vertically integrated home development company, engages in the development, construction and sale of affordable entry-level, middle-income and tourism housing in Mexico, as well as affordable entry-level housing in Brazil. This stock has been in play with the bulls so far in 2014, with shares up sharply by 34%.

If you take a look at the chart for Desarrolladora Homex you'll notice that this stock formed a double bottom chart pattern over the last month and change, with shares finding buying interest $1.23 to $1.24 a share. Since that bottom, shares of HXM have started to uptrend and moved within range of triggering a major breakout trade above some key near-term overhead resistance levels.

Traders should now look for long-biased trades in HXM if it manages to break out above its 50-day moving average of $1.62 and then once it clears more key near-term overhead resistance levels at $1.63 to $1.68 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 730,702 shares. If that breakout materializes soon, then HXM will set up to re-test or possibly take out its next major overhead resistance levels at its 200-day moving average of $1.80 to $2.20 a share, or even $2.40 a share.

Traders can look to buy HXM off weakness to anticipate that breakout and simply use a stop that sits just below some key near-term support at $1.40 a share. One can also buy HXM 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.

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.


RELATED LINKS:







Follow Stockpickr on Twitter and become a fan on Facebook.

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.