To identify a breakout stock, determine the support and resistance levels. A support level is the lower boundary for a stock’s movements, while a resistance level indicates the maximum price it trades at during a significant period.
In simple terms, demand is the lowest at the support level, meaning most traders are willing to sell. Conversely, most traders are eager to buy at the resistance level, hoping to add the stock to their portfolio. The key to spotting breakout stocks is to focus on those approaching a breakout or just breaking above the resistance level.
To that end, the following have been selected as today’s breakout stocks.
This post originally appeared at Zacks.