By Trades Of The Day Research Team,Trades Of The Day, 2024-09-09
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 | United Airlines Holdings Inc. | NASDAQ: UAL | $46.01 | $47.40 | Downtrend Channel Breakout |
| 2 | Tarsus Pharmaceuticals Inc. | NASDAQ: TARS | $30.59 | $31.20 | Falling Wedge Pattern Breakout |
| 3 | CME Group Inc. | NASDAQ: CME | $220.50 | $222.00 | Symmetrical Triangle Pattern Breakout |
| 4 | NIO Inc. ADR | NYSE: NIO | $5.02 | $5.40 | Falling Wedge Pattern Breakout |
| 5 | Stericycle Inc. | NASDAQ: SRCL | $61.60 | $62.35 | Breakout From Consolidation Area |
| 6 | Apellis Pharmaceuticals Inc. | NASDAQ: APLS | $41.05 | $42.70 | Falling Wedge Pattern Breakout |
| 7 | Immunovant Inc. | NASDAQ: IMVT | $34.03 | $35.00 | Downtrend Channel Breakout |
| 8 | Sun Communities, Inc. | NYSE: SUI | $141.22 | $142.40 | Ascending Triangle Pattern Breakout |
| 9 | DENTSPLY Sirona Inc. | NASDAQ: XRAY | $25.55 | $26.50 | Downtrend Channel |
| 10 | Travere Therapeutics Inc. | NASDAQ: TVTX | $10.98 | $11.50 | Ascending 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.
#1 United Airlines Holdings Inc. (NASDAQ: UAL)
Sector: Industrials • Airlines
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 UAL is if the stock has a daily close above $47.40. This is marked in the chart below as a green color dotted line.
UAL – Downtrend Channel Breakout
#2 Tarsus Pharmaceuticals Inc. (NASDAQ: TARS)
Sector: Healthcare • Biotechnology
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 TARS is above the nearest resistance level of $31.20. This is marked in the chart below as a green color dotted line.
TARS – Falling Wedge Pattern Breakout
#3 CME Group Inc. (NASDAQ: CME)
Sector: Financial • Financial Data & Stock Exchanges
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 CME is if the stock closes above the immediate resistance level of $222.00. This is marked in the chart below as a green color dotted line.
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