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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.
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.
With that in mind, let's take a look at several stocks rising on unusual volume today.
Linn Energy (LINE), an oil and natural gas company, acquires and develops various oil and gas properties in the U.S. This stock is trading up 12.1% at $26.04 in recent trading.
Today's Volume: 10.17 million
Average Volume: 3.63 million
Volume % Change: 335%
Shares of LINE are soaring higher today after Bank of America upgraded the stock to buy from neutral based on valuation and expectations its cash distributions are sustainable.
From a technical perspective, LINE is ripping higher here above its recent low of $20.14 with heavy upside volume. This move is coming off oversold territory for shares of LINE, since the stock recently registered a relative strength index reading below 30. Shares of LINE are now starting to move within range of triggering a near-term breakout trade. That trade will hit if LINE manages to take out some near-term overhead resistance levels at $27 to its recent gap down day high of $29.76 with high volume.
Traders should now look for long-biased trades in LINE as long as it's trending above $24, and then once it sustains a move or close above those breakout levels with volume that hits near or above 3.63 million shares. If that breakout triggers soon, then LINE will set up to re-fill some of its previous gap down zone that started near $33.50. Any high-volume move above $33.50 to $34.50 could then send LINE north of $35.
PetroChina (PTR) produces and sells oil and gas in the Peoples Republic of China. This stock is trading up 0.6% at $114.53 in recent trading.
Today's Volume: 117,000
Average Volume: 144,783
Volume % Change: 54%
From a technical perspective, PTR is trending higher here right above some near-term support at $112.50 with decent upside volume. This stock has been uptrending strong for the last few weeks, with shares soaring higher from its low of $99.28 to its intraday high of $115. During that move, shares of PTR have been consistently making higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of PTR within range of triggering a near-term breakout trade. That trade will hit if PTR manages to take out its 50-day moving average of $117.01 with high volume.
Traders should now look for long-biased trades in PTR as long as it's trending above some key near-term support at $112.50, and then once it sustains a move or close above its 50-day at $117.01 with volume that hits near or above 144,783 shares. If that breakout triggers soon, then PTR will set up to re-test or possibly take out its next major overhead resistance levels at $120 to $125.
Walter Energy (WLT) is a producer and exporter of metallurgical coal for the global steel industry. It also produces steam coal, coal bed methane gas, metallurgical coke and other related products. This stock is trading up 6.3% to $11 in recent trading.
Today's Volume: 7.54 million
Average Volume: 8.44 million
Volume % Change: 79%
From a technical perspective, WLT is bouncing sharply higher here right off some near-term support at $10.22 with decent upside volume. This stock has been downtrending badly for the last six months, with shares plunging lower from its high of $40.30 to its recent low of $9.88. During that downtrend, shares of WLT have been consistently making lower highs and lower lows, which is bearish technical price action. That said, shares of WLT are now rebounding off oversold levels and it's quickly approaching a near-term breakout trade. That trade will hit if WLT manages to take out some near-term overhead resistance at $11.55 to $12.87 with high volume.
Traders should now look for long-biased trades in WLT as long as it's trending above some key near-term support at $10.22 and then once it sustains a move or close above those breakout levels with volume that hits near or above 8.44 million shares. If that breakout triggers soon, then WLT will set up to re-test or possibly take out its next major overhead resistance levels at $13.93 to its 50-day at $15.47.
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.
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.