Stock Quotes in this Article: ICLR, UFS 


DELAFIELD, Wis. (Stockpickr) -- Professional traders running mutual funds and hedge funds don't just look at a stock's price moves; they also track big changes in volume activity. Often when above-average volume moves into an equity, it precedes a large spike in volatility.

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Major moves in volume can signal unusual activity, such as insider buying or selling -- or buying or selling by "superinvestors."

Unusual volume can also be a major signal that hedge funds and momentum traders are piling into a stock ahead of a catalyst. These types of traders like to get in well before a large spike, so it's always a smart move to monitor unusual volume. That said, remember to combine trend and price action with unusual volume. Put them all together to help you decipher the next big trend for any stock.

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With that in mind, let's take a look at several stocks rising on unusual volume recently.

Icon

Icon (ICLR) a contract research organization, provides outsourced development services to the pharmaceutical, biotechnology and medical device industries primarily in Ireland, the U.S. and rest of Europe. This stock closed up 3.5% to $43.61 in Wednesday's trading session.

Wednesday's Volume: 562,000

Three-Month Average Volume: 372,292

Volume % Change: 80%

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From a technical perspective, ICLR jumped higher here right above some near-term support at $41 with above-average. This stock has been uptrending strong for the last two months, with shares moving higher from its low of $36.42 to its intraday high of $43.70. During that uptrend, shares of ICLR have been consistently making higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of ICLR within range of triggering a big breakout trade. That trade will hit if ICLR manages to take out Wednesday's high of $43.70 to its 52-week high at $44.23 with high volume.

Traders should now look for long-biased trades in ICLR as long as it's trending above $41 or above its 50-day at $40 and then once it sustains a move or close above those breakout levels with volume that hits near or above 372,292 shares. If that breakout hits soon, then ICLR will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $50 to $55.

Domtar

Domtar (UFS) designs, manufactures, markets and distributes communications papers, specialty and packaging papers, and adult incontinence products worldwide. This stock closed up 1.1% at $106 in Wednesday's trading session.

Wednesday's Volume: 1.89 million

Three-Month Average Volume: 367,447

Volume % Change: 416%

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From a technical perspective, UFS trended modestly higher here right above some near-term support at $100 with heavy upside volume. This move is quickly pushing shares of UFS within range of triggering a near-term breakout trade. That trade will hit if UFS manages to take out some near-term overhead resistance at $108 to its 52-week high at $110.20 with high volume.

Traders should now look for long-biased trades in UFS as long as it's trending above some near-term support at $100 and then once it sustains a move or close above those breakout levels with volume that this near or above 367,447 shares. If that breakout hits soon, then UFS will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $120 to $130.

To see more stocks rising on unusual volume, check out the Stocks Rising on Unusual Volume portfolio on Stockpickr.

-- Written by Roberto Pedone in Delafield, Wis.


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At the time of publication, author had no positions in stocks mentioned.

Roberto Pedone, based out of Delafield, Wis., is an independent trader who focuses on technical analysis for small- and large-cap stocks, options, futures, commodities and currencies. Roberto studied international business at the Milwaukee School of Engineering, and he spent a year overseas studying business in Lubeck, Germany. His work has appeared on financial outlets including

CNBC.com and Forbes.com. You can follow Pedone on Twitter at www.twitter.com/zerosum24 or @zerosum24.