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WINDERMERE, Fla. (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.
Lam Research (LRCX) is a supplier of wafer fabrication equipment and services to the worldwide semiconductor industry. This stock is trading up 9.1% at $36.65 in recent trading.
Today’s Volume: 8.2 million
Average Volume: 3.3 million
Volume % Change: 247%
Shares of LRCX are ripping higher after the company reported a profit of $2.77 million, or 2 cents a share, vs. a profit of $71.83 million, or 58 cents a share, for the year-earlier period. Revenue was $906.89 million, up from $680.44 million. >>3 Tech Stocks Hedge Funds Are Buying From a technical perspective, LRCX is soaring higher here right off its 50-day moving average of $33.59 with monster volume. This move has also pushed LRCX into breakout territory, since the stock has taken out some near-term overhead resistance levels at $35.08 to $35.99.
Traders should now look for long-biased trades in LRCX off its next major breakout. That trade will hit once LRCX manages to take out some more overhead resistance levels at $38.17 to $38.99 with high volume. Look for long trades in LRCX as long as it’s trending above $36, and then once it sustains a move or close above those breakout levels with volume that hits near or above 3.3 million shares. If that breakout triggers soon, then LRCX will setup to re-test or possibly take out its next major overhead resistance levels at $40 to $42.
NetScout Systems (NTCT) designs, develops, manufactures, markets, licenses, sells and supports market application and network performance management and service assurance solutions for the Internet protocol based service delivery environments. This stock is trading up 7% at $25.30 in recent trading.
Today’s Volume: 706,000
Average Volume: 211,414
Volume % Change: 361%
Shares of NTCT are trending up here after the company crushed Wall Street expectations with its fiscal second quarter earnings that grew 42% to 34 cents per share vs. analysts estimates of 26 cents per share. Sales jumped 16% to $84.5 million, also above Wall Street expectations.
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From a technical perspective, NTCT is gapping up sharply here back above its 50-day at $24.71 with above-average volume. This move is quickly pushing NTCT within range of triggering a major breakout trade. That trade will hit once NTCT manages to take out some near-term overhead resistance at $26.59 with high volume. At last check, NTCT has hit an intraday high of $26.31 and volume is tracking in well above its three-month average action of 211,414 shares.
Traders should now look for long-biased trades in NTCT as long as its trending above its 50-day, and then once it sustains a move or close above $26.59 with volume that tracks in near or above 211,414 shares.
Juniper Networks (JNPR) designs, develops, and sells products and services that together provide its customers with network infrastructure. This stock is trading up 3.9% at $18.00 in recent trading.
Today’s Volume: 20 million
Average Volume: 8.6 million
Volume % Change: 229%
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From a technical perspective, JNPR is gapping higher here back above its 50-day moving average at $17.93 and right up to its 200-day moving average of $19.18 with monster upside volume. At last check, JNPR has hit an intraday high of $19.22 but subsequently pulled back to its current price around $18.
Traders should now look for long-biased trades in JNPR as long as its trending above its 200-day, and then once it triggers a near-term breakout above some resistance at $20. Look for a sustained move or close above $19.18 to $20 with volume that hits near or above 8.6 million shares. If that breakout triggers soon, then JNPR will setup to re-test or possibly take out its next major overhead resistance levels at $22 to $23 and then $24 to $25. To see more stocks rising on unusual volume, check out the Stocks Rising on Unusual Volume portfolio on Stockpickr. -- Written by Roberto Pedone in Winderemere, Fla.
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At the time of publication, author had no positions in stocks mentioned.
Roberto Pedone, based out of Windermere, Fla., is an independent trader who focuses on stocks, options, futures, commodities and currencies. He is also an outside contributor to Beconequity.com and maintains the website Maddmoney.net, which he sold to Blue Wave Advisors in 2008. Roberto studied International Business at The Milwaukee School of Engineering, and he spent a year overseas studying business in Lubeck, Germany.