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2 Stocks Spiking on Unusual Volume - views
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.
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.
>>5 Stocks Poised for Breakouts With that in mind, let's take a look at several stocks rising on unusual volume recently. GasLog
GasLog (GLOG) owns, operates, and manages vessels in the liquefied natural gas market worldwide. This stock closed up 4.3% at $23.78 in Monday's trading session.
Monday's Volume: 1.13 million
Three-Month Average Volume: 783,125
Volume % Change: 162%
>>5 Hated Earnings Stocks You Should Love From a technical perspective, GLOG jumped sharply higher here right above some near-term support at $22 with above-average volume. This stock has been uptrending strong for the last three months, with shares moving higher from its low of $14.92 to its recent high of $24.23. During that uptrend, shares of GLOG have been consistently making higher lows and higher highs, which is bullish technical price action. This spike higher on Monday is now starting to push shares of GLOG within range of triggering a near-term breakout trade. That trade will hit if GLOG manages to take out some near-term overhead resistance levels at $24 to its all-time high at $24.23 with high volume.
Traders should now look for long-biased trades in GLOG as long as it's trending above support at $22 or above its 50-day at $20.42 and then once it sustains a move or close above those breakout levels with volume that hits near or above 783,125 shares. If that breakout hits soon, then GLOG will set up to enter new all-time-high territory, which is bullish technical price action. Some possible upside targets off that move are $30 to $35.
EPAM Systems (EPAM) provides software engineering solutions and technology services worldwide. This stock closed up 3.9% to $33.34 in Monday's trading session.
Monday's Volume: 972,000
Three-Month Average Volume: 487,923
Volume % Change: 181%
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From a technical perspective, EPAM jumped higher here right above some near-term support at $31.71 with above-average volume. This stock recently formed a double bottom chart pattern at $31.76 to $31.71. That bottom is coming after shares of EPAM collapsed from its February high of $46.70 to its recent low of $31.71. Shares of EPAM could now be setting up for an oversold rally, since high volume is starting to move into this name after that recent double bottom.
Traders should now look for long-biased trades in EPAM as long as it's trending above support at $31.71 and then once it sustains a move or close above those Monday's intraday high of $33.37 to its 200-day moving average of $33.94 with volume that hits near or above 487,923 shares. If that move starts soon, then EPAM will set up to re-test or possibly take out its next major overhead resistance levels at $36.65 to its 50-day moving average of $39.08. 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.