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3 Stocks Spiking on Big 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 Hated Earnings Stocks You Should Love With that in mind, let's take a look at several stocks rising on unusual volume recently. Niska Gas Storage Partners
Niska Gas Storage Partners (NKA) owns and operates natural gas storage assets in North America. This stock closed up 3.4% at $15.77 in Monday's trading session.
Monday's Volume: 250,000
Three-Month Average Volume: 155,300
Volume % Change: 50%
From a technical perspective, NKA jumped higher with above-average volume. This stock has been uptrending strong for the last two months, with shares moving higher from its low of $11.30 to its intraday high of $15.90. During that uptrend, shares of NKA have been consistently making higher lows and higher highs, which is bullish technical price action. This spike higher on Monday is starting to push shares of NKA within range of triggering a big breakout trade. That trade will hit if NKA manages to take out Monday's high of $15.90 to more resistance at $16.25 and then once it clears its 52-week high at $17 with high volume.
Traders should now look for long-biased trades in NKA as long as it's trending above $15 or above its 50-day at $13.99 and then once it sustains a move or close above those breakout levels with volume that's near or above 155,300 shares. If that breakout kicks off soon, then NKA will set up to enter new 52-week-high territory above $17, which is bullish technical price action. Some possible upside targets off that move are $20 to $23.
500.com (WBAI) provides online sports lottery services in the People's Republic of China. This stock closed up 3.9% at $35.09 in Monday's trading session.
Monday's Volume: 875,000
Three-Month Average Volume: 588,944
Volume % Change: 64%
From a technical perspective, WBAI bounced notably higher here with above-average volume. This stock has sold off sharply over the last month and change, with shares moving lower from its high of $54 to its intraday low of $32.29. During that downtrend, shares of WBAI have been making mostly lower highs and lower lows, which is bearish technical price action. Shares of WBAI broke some key support intraday at $33.56, but manage to close back above that level with strong upside volume flows.
Traders should now look for long-biased trades in WBAI as long as it's trending above Monday's low of $32.29 and then once it sustains a move or close above some near-term overhead resistance levels at Monday's high of $35.23 to $37 with volume that's near or above 588,944 shares. If that move starts soon, then WBAI will set up to re-test or possibly take out its next major overhead resistance levels at $38.75 to its 50-day moving average of $41.56.
Platinum Underwriters (PTP), through its subsidiaries, provides property and marine, casualty and finite risk reinsurance coverage products worldwide. This stock closed up 1.4% at $60.24 in Monday's trading session.
Monday's Volume: 351,000
Three-Month Average Volume: 149,956
Volume % Change: 147%
From a technical perspective, PTP spiked notably higher right above its 200-day moving average of $59.31 with above-average volume. This move higher on Monday is starting to push shares of PTP within range of triggering a near-term breakout trade. That trade will hit if PTP manages to take out Monday's high of $60.42 to some more key overhead resistance levels at $61.01 to $61.43 with high volume.
Traders should now look for long-biased trades in PTP as long as it's trending above its 200-day at $59.31 or above its 50-day at $58.60 and then once it sustains a move or close above those breakout levels with volume that's near or above 149,956 shares. If that breakout kicks off soon, then PTP will set up to re-test or possibly take out its next major overhead resistance level at its 52-week high at $63.60. 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.