For Immediate Release
Chicago, IL – November 7, 2018 - Stocks in this week’s article include: FireEye, Inc. FEYE, Nokia Corp. NOK, 21Vianet Group, Inc. VNET, Endurance International Group Holdings, Inc. EIGI and Energy Fuels Inc. UUUU.
Screen of the Week of Zacks Investment Research:
5 Breakout Stocks Offering Admirable Returns
Selecting breakout stocks is probably one of the most favored techniques among active investors. The idea behind this kind of stock selection is to determine which stocks are trading within a narrow channel. These stocks are to be bought as soon as they move above this band and are sold when they fall below. In case a stock moves above this band, it usually gains momentum.
However, market watchers warn against incorrectly timing such a move. This is because of the significant risk of identifying stock movements as breakouts, which in reality are not so. At the same time, when this strategy is utilized judiciously, it yields substantive gains, which is the reason why it remains popular.
Zeroing in on Breakout Stocks
In order to select the right breakout stock one has to first calculate its support and resistance level. A support level is the lower bound for stock movements while a resistance level refers to the maximum price which it trades within over a considerable period.
In other words, the demand for a stock is at its lowest at its support level, which means most traders are willing to sell it. At the resistance level, most traders are willing to go long on the stock, which means that they would like to add them to their portfolios. The key to identifying breakout stocks is to zero in on those that are on the verge of a breakout or those that have just broken above the resistance level.
Verifying Whether It’s for Real
Stocks which have breached their resistance level should ideally be in high demand among traders. But the test of whether this is a genuine breakout is whether they go on to attain higher prices and the old barrier becomes a new support. This is why it is important to determine whether a long-term price trend is about to emerge.
Only a study of long-term trends can determine whether the existing trading channel has been breached effectively. This indicates the strength of the support or resistance levels. If you can identify the effective channel for a stock, picking it even at a not-so-reasonable price would give you significant returns.
And that's what we're screening for today…
For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/335312/5-breakout-stocks-offering-admirable-returns
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Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.
About Screen of the Week
Zacks.com created the first and best screening system on the web earning the distinction as the "#1 site for screening stocks" by Money Magazine. But powerful screening tools is just the start. That is why Zacks created the Screen of the Week to highlight profitable stock picking strategies that investors can actively use.
Strong Stocks that Should Be in the News
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Contact: Jim Giaquinto
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21Vianet Group, Inc. (VNET) : Free Stock Analysis Report
FireEye, Inc. (FEYE) : Free Stock Analysis Report
Endurance International Group Holdings, Inc. (EIGI) : Free Stock Analysis Report
Nokia Corporation (NOK) : Free Stock Analysis Report
Energy Fuels Inc (UUUU) : Free Stock Analysis Report
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