Below we have identified our top 10 stocks that look poised for a possible breakout in the coming days. Traders should add these stocks to their watchlist now.
The Top 10 Stocks to Watch This Week for Possible Breakouts
| Sl # | Name of the Stock | Stock Ticker | Last Close | Buy Level(s) | Reason |
| 1 | Hut 8 Corp | NASDAQ: HUT | $14.84 | $15.20 | Symmetrical Triangle Pattern Breakout |
| 2 | Karuna Therapeutics Inc. | NASDAQ: KRTX | $317.85 | $319.00 | Breakout From Consolidation Area |
| 3 | Roblox Corporation | NYSE: RBLX | $45.97 | $46.60 | Downtrend Channel Breakout |
| 4 | BrightView Holdings Inc. | NYSE: BV | $8.53 | $9.20 | Symmetrical Triangle Pattern Breakout |
| 5 |
Triumph Group Inc. |
NYSE: TGI | $16.85 | $17.25 | Falling Wedge Pattern Breakout |
| 6 | Peabody Energy Corp. | NYSE: BTU | $25.06 | $25.50 | Symmetrical Triangle Pattern Breakout |
| 7 | Daseke Inc. | NASDAQ: DSKE | $8.10 | $8.30 | Downtrend Channel Breakout |
| 8 | Seadrill Ltd. | NYSE: SDRL | $46.66 | $47.00 | Symmetrical Triangle Pattern Breakout |
| 9 | Tsakos Energy Navigation Limited | NYSE: TNP | $23.97 | $24.10 | Uptrend Channel Breakout |
| 10 | UGI Corp. | NYSE: UGI | $24.51 | $24.75 | Downtrend Channel Breakout |
Important: Typically, these trades offer a risk: reward ratio of 1:2 or 1:3 in the next 6 months, which implies 2x to 3x rewards when compared to risks. So, be sure to set your stop-loss levels and target prices accordingly to manage your risk. In addition, these trade ideas are triggered using daily closing prices, not intra-day pricing. So, if you participate in these trades, make sure that you only buy the stock once its daily close is above the recommended price level.
That said, here are the top 10 stocks to watch for a breakout, in no particular order.
#1 Hut 8 Corp (NASDAQ: HUT)
Sector: Financial • Capital Markets
Reason: Symmetrical Triangle Pattern Breakout
A symmetrical triangle is a chart pattern formed by two converging trend lines connecting a series of sequential peaks and troughs. These two lines result in the formation of a triangle that appears to be symmetrical.
A symmetrical triangle pattern is usually formed when there is indecision in the price movements and there is uncertainty among the buyers and sellers. This chart pattern represents a period of consolidation before the price breaks out or breaks down. In case a breakout occurs from the upper trend line, it is a strong bullish indication as it signifies the start of a new bullish trend.
Buy Level(s): The stock has currently broken out of a symmetrical triangle pattern. However, the ideal buy level for HUT is if the stock closes above the immediate resistance level of $15.20. This is marked in the chart below as a green color dotted line.
Daily chart – HUT
HUT – Symmetrical Triangle Pattern Breakout
#2 Karuna Therapeutics Inc. (NASDAQ: KRTX)
Sector: Healthcare • Biotechnology
Reason: Breakout From a Consolidation Area in the Daily Chart
A Consolidation Area is a price action contained between two parallel lines. It is formed by a lower line that connects the lows, and an upper line that joins the highs. A stock usually trades between the two lines of the consolidation area before finally breaking out from the upper rail.
Buy Level(s): Although the stock has currently broken out of a consolidation area, the ideal buy level for KRTX is above the near-term resistance area, which translates to a price of around $319.00. This is marked in the chart below as a green color dotted line.
Daily chart – KRTX
KRTX – Breakout From Consolidation Area
#3 Roblox Corporation (NYSE: RBLX)
Sector: Communication Services • Electronic Gaming & Multimedia
Reason: Downtrend Channel Breakout
A downtrend or descending channel is the price action contained between downward sloping parallel lines. It is formed by two lines that are drawn by connecting the lower highs and lower lows of a stock’s price. Even though this is typically a bearish pattern, a breakout from the upper rail of this pattern is considered a good bullish indication.
Buy Level(s): The daily chart shows that the stock has currently broken out of a downtrend channel. However, there is a near-term resistance level for the stock. Hence, the ideal buy level for RBLX is if the stock has a daily close above $46.60. This is marked in the chart below as a green color dotted line.
Daily chart – RBLX
RBLX – Downtrend Channel Breakout
#4 BrightView Holdings Inc. (NYSE: BV)
Sector: Industrials • Specialty Business Services
Reason: Symmetrical Triangle Pattern Breakout
A symmetrical triangle is a chart pattern formed by two converging trend lines connecting a series of sequential peaks and troughs. These two lines result in the formation of a triangle that appears to be symmetrical.
A symmetrical triangle pattern is usually formed when there is indecision in the price movements and there is uncertainty among the buyers and sellers. This chart pattern represents a period of consolidation before the price breaks out or breaks down. In case a breakout occurs from the upper trend line, it is a strong bullish indication as it signifies the start of a new bullish trend.
Buy Level(s): The stock has currently broken out of a symmetrical triangle pattern. However, the ideal buy level for BV is if the stock closes above the immediate resistance level of $9.20. This is marked in the chart below as a green color dotted line.
Daily chart – BV
BV – Symmetrical Triangle Pattern Breakout
#5 Triumph Group Inc. (NYSE: TGI)
Sector: Industrials • Aerospace & Defense
Reason: Falling Wedge Pattern Breakout
A falling wedge pattern is formed by joining two downward-sloping, converging trendlines having a contracting range. The pattern appears to be wide at the top and continues to contract as prices fall. A breakout from a falling wedge pattern can indicate either reversal or continuation depending on where the pattern appeared in the trend.
A stock that has broken out of a falling wedge pattern would have gained momentum and would have the potential to move higher.
Buy Level(s): The stock has currently broken out of a falling wedge pattern. However, the ideal buy level for TGI is above the nearest resistance level of $17.25. This is marked in the chart below as a green color dotted line.
Daily chart – TGI
TGI – Falling Wedge Pattern Breakout
#6 Peabody Energy Corp. (NYSE: BTU)
Sector: Energy • Thermal Coal
Reason: Symmetrical Triangle Pattern Breakout
A symmetrical triangle is a chart pattern formed by two converging trend lines connecting a series of sequential peaks and troughs. These two lines result in the formation of a triangle that appears to be symmetrical.
A symmetrical triangle pattern is usually formed when there is indecision in the price movements and there is uncertainty among the buyers and sellers. This chart pattern represents a period of consolidation before the price breaks out or breaks down. In case a breakout occurs from the upper trend line, it is a strong bullish indication as it signifies the start of a new bullish trend.
Buy Level(s): The stock has currently broken out of a symmetrical triangle pattern. However, the ideal buy level for BTU is if the stock closes above the immediate resistance level of $25.50. This is marked in the chart below as a green color dotted line.
Daily chart – BTU
BTU – Symmetrical Triangle Pattern Breakout
#7 Daseke Inc. (NASDAQ: DSKE)
Sector: Industrials • Trucking
Reason: Downtrend Channel Breakout
A downtrend or descending channel is the price action contained between downward sloping parallel lines. It is formed by two lines that are drawn by connecting the lower highs and lower lows of a stock’s price. Even though this is typically a bearish pattern, a breakout from the upper rail of this pattern is considered a good bullish indication.
Buy Level(s): The daily chart shows that the stock has currently broken out of a downtrend channel. However, there is a near-term resistance level for the stock. Hence, the ideal buy level for DSKE is if the stock has a daily close above $8.30. This is marked in the chart below as a green color dotted line.
Daily chart – DSKE
DSKE – Downtrend Channel Breakout
#8 Seadrill Ltd. (NYSE: SDRL)
Sector: Energy • Oil & Gas Drilling
Reason: Symmetrical Triangle Pattern Breakout
A symmetrical triangle is a chart pattern formed by two converging trend lines connecting a series of sequential peaks and troughs. These two lines result in the formation of a triangle that appears to be symmetrical.
A symmetrical triangle pattern is usually formed when there is indecision in the price movements and there is uncertainty among the buyers and sellers. This chart pattern represents a period of consolidation before the price breaks out or breaks down. In case a breakout occurs from the upper trend line, it is a strong bullish indication as it signifies the start of a new bullish trend.
Buy Level(s): The stock has currently broken out of a symmetrical triangle pattern. However, the ideal buy level for SDRL is if the stock closes above the immediate resistance level of $47.00. This is marked in the chart below as a green color dotted line.
Daily chart – SDRL
SDRL – Symmetrical Triangle Pattern Breakout
#9 Tsakos Energy Navigation Limited (NYSE: TNP)
Sector: Energy • Oil & Gas Midstream • Greece
Reason: Breakout From an Uptrend Channel
An uptrend channel or an ascending channel is the price action contained between upward sloping parallel lines. It is formed by a lower trend line that connects the swing lows, and an upper channel line that joins the swing highs. A stock usually trades between the two rails of the uptrend channel before finally breaking out from the upper rail.
Buy Level(s): The stock has currently broken out of the uptrend channel. However, the ideal buy level for TNP is if the stock has a daily close above the near-term resistance level of $24.10. This is marked in the chart below as a green color dotted line.
Daily chart – TNP
TNP – Uptrend Channel Breakout
#10 UGI Corp. (NYSE: UGI)
Sector: Utilities • Utilities – Regulated Gas
Reason: Downtrend Channel Breakout
A downtrend or descending channel is the price action contained between downward sloping parallel lines. It is formed by two lines that are drawn by connecting the lower highs and lower lows of a stock’s price. Even though this is typically a bearish pattern, a breakout from the upper rail of this pattern is considered a good bullish indication.
Buy Level(s): The daily chart shows that the stock has currently broken out of a downtrend channel. However, there is a near-term resistance level for the stock. Hence, the ideal buy level for UGI is if the stock has a daily close above $24.75. This is marked in the chart below as a green color dotted line.
Daily chart – UGI
UGI – Downtrend Channel Breakout
Happy Trading!
Trades of The Day Research Team