For Immediate Release
Chicago, IL – April 10, 2018 - Stocks in this week’s article Ecopetrol S.A. (EC - Free Report) , TheStreet, Inc. (TST - Free Report) , Cogentix Medical, Inc. (CGNT - Free Report) , Fortuna Silver Mines Inc. (FSM - Free Report) and CPI Aerostructures, Inc. (CVU - Free Report) .
5 Bargain Breakout Stocks Offering Amazing Returns
Utilizing a breakout investment strategy is a natural choice for active investors who settle for nothing less than superlative returns. This involves zeroing in on stocks trading within a tight range and buying them when they step out of this band. In keeping with this approach, they are offloaded whenever they move below this narrow band. If properly implemented, such a strategy could deliver impressive returns.
Spotting Prospective Candidates
In order to identify breakout stocks, you must first determine their resistance and support levels. A resistance level is the barrier which must be broken so as to be identified as a breakout stock. Meanwhile, a support level is the floor for the stock’s movement.
At the breakout level, demand for the stock has peaked, making it a natural choice for traders. On the other hand, when a stock hits the support floor, traders are eager to offload it. In order to spot breakout stocks, you would have to see which of these are on the brink of breaking the resistance barrier or those that have just breached this level.
Is This a Genuine Breakout?
The primary risk associated with such a strategy is that the decision to buy an apparent breakout candidate has been incorrectly timed. When a stock moves above the resistance level, it should be a highly prized commodity for traders. However, whether such a breakout is at all genuine is another matter altogether.
For a genuine breakout, the stock’s earlier resistance barrier should become its new support level. This only happens if the trading channel that has been established is tested by observing long-term price trends. The strength of the support and resistance levels can be ascertained only through such a study. Despite the risk of misidentification, correctly identifying such stocks can yield considerable returns, even at a price which may not seem attractive at first glance.
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Strong Stocks that Should Be in the News
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