Picking a winning trade on a consistent basis is not simply a stroke of luck. It’s the result of calculated screening, planning, and deliberation.
With this in mind, we have started a new weekly series on our top 10 stocks to watch this week — 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 | Ballys Corporation | NYSE: BALY | $14.50 | $15.00 | Symmetrical Triangle Pattern Breakout |
| 2 | Genuine Parts Co. | NYSE: GPC | $162.39 | $164.60 | Uptrend Channel Breakout |
| 3 | UGI Corp. | NYSE: UGI | $25.74 | $25.90 | Symmetrical Triangle Pattern Breakout |
| 4 | Janus International Group Inc. | NYSE: JBI | $15.14 | $15.50 | Flag Pattern |
| 5 | Bentley Systems Inc. | NASDAQ: BSY | $52.46 | $53.20 | Symmetrical Triangle Pattern |
| 6 | Xcel Energy, Inc. | NASDAQ: XEL | $54.72 | $55.10 | Falling Wedge Pattern Breakout |
| 7 | Consolidated Edison, Inc. | NYSE: ED | $91.77 | $92.50 | Symmetrical Triangle Pattern Breakout |
| 8 | Dyne Therapeutics Inc. | NASDAQ: DYN | $23.86 | $28.00 | Flag Pattern |
| 9 | PepsiCo Inc. | NASDAQ: PEP | $174.13 | $175.10 | Symmetrical Triangle Pattern |
| 10 | Mid Penn Bancorp, Inc. | NASDAQ: MPB | $20.50 | $20.90 | Symmetrical Triangle Pattern 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 Ballys Corporation (NYSE: BALY)
Sector: Consumer Cyclical • Resorts & Casinos
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 BALY is if the stock closes above the immediate resistance level of $15.00. This is marked in the chart below as a green color dotted line.
Daily chart – BALY
BALY – Symmetrical Triangle Pattern Breakout
#2 Genuine Parts Co. (NYSE: GPC)
Sector: Consumer Cyclical • Specialty Retail
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 GPC is if the stock has a daily close above the near-term resistance level of $164.60. This is marked in the chart below as a green color dotted line.
GPC – Uptrend Channel Breakout
#3 UGI Corp. (NYSE: UGI)
Sector: Utilities • Utilities – Regulated Gas
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 UGI is if the stock closes above the immediate resistance level of $25.90. This is marked in the chart below as a green color dotted line.
Daily chart – UGI
UGI – Symmetrical Triangle Pattern Breakout
#4 Janus International Group Inc. (NYSE: JBI)
Sector: Industrials • Building Products & Equipment
Reason: Formation of a Flag Pattern
A flag pattern is a short-term continuation pattern that marks a small consolidation before the previous move resumes. The pattern is formed when the market consolidates in a narrow range after a sharp move. For a stock in an uptrend, a breakout from this pattern is typically a strong bullish indication.
Buy Level(s): The ideal buy level for JBI is if the stock breaks out of the flag pattern, at around $15.50. This is marked in the chart below as a green color dotted line.
Daily chart – JBI
JBI – Flag Pattern
#5 Bentley Systems Inc. (NASDAQ: BSY)
Sector: Technology • Software – Application
Reason: Formation of a Symmetrical Triangle Pattern
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 ideal buy level for BSY is if the stock has a daily close above the breakout level of the symmetrical triangle pattern, at around $53.20. This is marked in the chart below as a green color dotted line.
Daily chart – BSY
BSY – Symmetrical Triangle Pattern
#6 Xcel Energy, Inc. (NASDAQ: XEL)
Sector: Utilities • Utilities – Regulated Electric
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 XEL is above the nearest resistance level of $55.10. This is marked in the chart below as a green color dotted line.
Daily chart – XEL
XEL – Falling Wedge Pattern Breakout
#7 Consolidated Edison, Inc. (NYSE: ED)
Sector: Utilities • Utilities – Regulated Electric
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 ED is if the stock closes above the immediate resistance level of $92.50. This is marked in the chart below as a green color dotted line.
Daily chart – ED
ED – Symmetrical Triangle Pattern Breakout
#8 Dyne Therapeutics Inc. (NASDAQ: DYN)
Sector: Healthcare • Biotechnology
Reason: Formation of a Flag Pattern
A flag pattern is a short-term continuation pattern that marks a small consolidation before the previous move resumes. The pattern is formed when the market consolidates in a narrow range after a sharp move. For a stock in an uptrend, a breakout from this pattern is typically a strong bullish indication.
Buy Level(s): The ideal buy level for DYN is if the stock breaks out of the flag pattern, at around $28.00. This is marked in the chart below as a green color dotted line.
Daily chart – DYN
DYN – Flag Pattern
#9 PepsiCo Inc. (NASDAQ: PEP)
Sector: Consumer Defensive • Beverages – Non-Alcoholic
Reason: Formation of a Symmetrical Triangle Pattern
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 ideal buy level for PEP is if the stock has a daily close above the breakout level of the symmetrical triangle pattern, at around $175.10. This is marked in the chart below as a green color dotted line.
Daily chart – PEP
PEP – Symmetrical Triangle Pattern
#10 Mid Penn Bancorp, Inc. (NASDAQ: MPB)
Sector: Financial • Banks – Regional
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 MPB is if the stock closes above the immediate resistance level of $20.90. This is marked in the chart below as a green color dotted line.
Daily chart – MPB
MPB – Symmetrical Triangle Pattern Breakout
Happy Trading!
Trades of The Day Research Team
Source: Trades of the Day