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Breakouts for Oct 13th: The first pick, DWSN, first featured as a gold member play on Sep 14th. Gold members should note the raised stop, although the original price target remains unchanged. Once again, the stock rallies in the absence of company specific news. The MACD has yet to reach the last reaction high (a potential bearish divergence), but should prices continue in an upward vein then it should not be long before we see new highs here. On balance volume continues to rise sharply and today's volume was the heaviest for the stock this year. The second pick, LVLT, is working through a base. Today's action is too extended in the short term to be buying, given the proximity of two converging resistance levels, although the Northrop Grumman deal provides a fundamental reason for the breakout. GTC orders between $3.05-$3.20 should provide a better risk:reward than the one suggested currently (set for the purposes of my analysis). What I like about this stock is the technical strength; the MACD pressuring 6-month resistance, a consolidation break in on balance volume, and slow stochastics past the last near term high. The third pick, LTON, is similar to the previous play in technical strength, and it is working through its base. At current valuations, it is a better buy, although there was no recent fundamental announcement from the company to account for price strength. Short term traders will likely play this to $12.10 as it could be a number of months before it approaches its IPO highs. However, a break of its highs will leave no overhead resistance, so selling at $15.00 might be viewed as overly cautious.

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"IBD" refers to Investors Business Daily