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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.
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 Toxic Stocks to Sell Now With that in mind, let's take a look at several stocks rising on unusual volume recently.
Blyth (BTH), together with its subsidiaries, operates as a direct to consumer marketing company in North America, Europe and Australia. This stock closed up 6.1% to $10.65 in Monday's trading session.
Monday's Volume: 347,000
Three-Month Average Volume: 133,351
Volume % Change: 133%
From a technical perspective, BTH trended sharply higher here right above its 50-day moving average of $9.61 with above-average volume. This move pushed shares of BTH into breakout territory, after the stock took out some near-term overhead resistance at $10.54. Market players should now look for a continuation move higher in the short-term if BTH manages to take out Monday's high of $10.82 to some more past resistance at $11.10 with high volume.
Traders should now look for long-biased trades in BTH as long as it's trending above Monday's low of $10.12 or above its 50-day at $9.61 and then once it sustains a move or close above $10.82 to $11.10 with volume that hits near or above 133,351 shares. If we get that move soon, then BTH will set up to re-test or possibly take out its next major overhead resistance levels at its 200-day moving average of $11.63 or $13. Usana Health Sciences
Usana Health Sciences (USNA) develops, manufactures and sells science-based nutritional and personal care products focusing on chronic degenerative disease worldwide. This stock closed up 1.6% at $80.30 in Monday's trading session.
Monday's Volume: 328,000
Three-Month Average Volume: 164,556
Volume % Change: 146%
From a technical perspective, USNA gapped up sharply higher here back above its 50-day moving average of $68.88 with strong upside volume. This stock recently formed a double bottom chart pattern at $66 to $65.46. Following that bottom, shares of USNA have started to spike sharply higher and move within range of triggering a major breakout trade. That trade will hit if USNA manages to take out its 200-day moving average of $75.35 and then once it clears more key overhead resistance levels at $77.92 to $78.93 with high volume.
Traders should now look for long-biased trades in USNA as long as it's trending above its 50-day at $68.88 and then once it sustains a move or close above those breakout levels with volume that's near or above 164,556 shares. If that breakout materializes soon, then USNA will set up to re-fill some of its previous gap-down-day zone from last October that started at $92.
Ply Gem (PGEM), together with its subsidiaries, manufactures and sells residential and commercial building products primarily in the U.S. and Canada. This stock closed up 4.3% at $12.07 in Monday's trading session.
Monday's Volume: 494,000
Three-Month Average Volume: 271,752
Volume % Change: 96%
From a technical perspective, PGEM bounced sharply higher here right above its recent low of $11.06 with above-average volume. This stock has been downtrending badly for the last three months, with shares dropping sharply from its high of $18.45 to its recent 52-week low of $11.06. During that downtrend, shares of PGEM have been making mostly lower highs and lower lows, which is bearish technical price action. That said, shares of PGEM are now starting to bounce higher and the stock flirted with a breakout on Monday after it tested some near-term overhead resistance at $12.24.
Traders should now look for long-biased trades in PGEM as long as it's trending above Monday's low of $11.40 or above its 52-week low of $11.06 and then once it sustains a move or close above Monday's high of $12.41 with volume that's near or above 271,752 shares. If that move starts soon, then PGEM will set up to re-test or possibly take out its next major overhead resistance levels at its 50-day moving average of $13.04 to $13.50. Any high-volume move above those levels will then give PGEM a chance to tag $14.50 to $15, or to re-fill some of its previous gap-down-day zone from January that started above $17.
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.