Stock Quotes in this Article: BKS, COST, DLTR, WMT

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.

Major moves in volume can signal unusual activity, such as insider buying or selling -- or buying or selling by “superinvestors.”

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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.

 

Costco Wholesale

Costco Wholesale (COST) operates warehouses that offer members low prices on a limited selection of branded and selected private-label products in a range of merchandise categories. This stock is trading up 3.7% at $103.34 in recent trading.

Today’s Volume: 3.4 million

Average Volume: 1.6 million

Volume % Change: 283%

Shares of COST are moving notably higher today after the company said a membership fee hike last year contributed to better-than-expected fourth-quarter earnings.

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From a technical perspective, COST is trending up here with above-average volume. This move has started to push COST into near-term breakout territory, since the stock is challenging some overhead resistance levels at $102.40 to $103.51. At last check, COST has hit an intraday high of $104.43 and volume is well above its three-month average action of 1.6 million shares.

Traders should now look for long-biased trades in COST as long as it’s trending above $102.40 to $103.51 with strong upside volume flows. I would consider any upside volume day that registers near or above 1.6 million shares as bullish. If COST can maintain that trend, then this stock will have a great chance of trending north of $110 in the near future.

Keep in mind that today’s action has pushed COST into new 52-week-high territory, which is bullish technical price action.

Costco is one of Warren Buffett's holdings as of the most recently reported period.

Wal-Mart Stores

Wal-Mart Stores (WMT) operates retail stores in various formats around globally. This stock is trading up 3.5% at $76.79 in recent trading.

Today’s Volume: 7.7 million

Average Volume: 7.5 million

Volume % Change: 70%

Shares of WMT are ripping higher today after the company said it plans to accelerate the expansion of small stores, particularly its Neighborhood Market stores, as it looks to compete with a variety of rivals from dollar stores to drug chains.

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From a technical perspective, WMT is bouncing strong here right near its 50-day moving average of $73.71 with above-average volume. This move has also pushed WMT into breakout territory, since the stock has started to push above some near-term overhead resistance at $75.19. At last check, WMT has hit an intraday high of $76.77 and volume has just started to eclipse its three-month average volume of 7.5 million shares.

Traders should now look for long-biased trades in WMT as long as it’s trending above its 50-day at $73.71 with strong upside volume flows. I would consider any upside volume day that registers near or above 7.5 million shares as bullish. If WMT can maintain that trend, then this stock has a great chance of trending north of $80 in the near future.

Wal-Mart was also featured recently in “5 Big Stocks to Trade for Post-Debate Gains.”

Dollar Tree

Dollar Tree (DLTR) is an operator of discount variety stores offering merchandise at the fixed price. This stock is trading up 3.4% at $47.39 in recent trading.

Today’s Volume: 2.2 million

Average Volume: 2.3 million

Volume % Change: 63%

Shares of DLTR are trading to the upside here after Wells Fargo upgraded the stock from market perform to outperform.

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From a technical perspective, DLTR is bouncing higher here right off some near-term support at $45.76 with decent volume. This move is quickly pushing DLTR within range of triggering a near-term breakout trade. That trade will hit once DLTR manages to take out its 200-day at $48.21 and its 50-day at $48.59, and then once it clears more overhead resistance at $49.57 with high volume.

Traders should now look for long-biased trades in DLTR once it sustains a move or close above those breakout levels with volume that hits near or above 2.3 million shares. If that breakout triggers soon, then look for DLTR to re-test or possibly take out its next major overhead resistance level at $53.

Barnes & Noble

Barnes & Noble (BKS) is a content, commerce and technology company that provides customers access to books, magazines, newspapers and other content across its multi-channel distribution platform. This stock is trading up 5% at $14.50 in recent trading.

Today’s Volume: 1.2 million

Average Volume: 963,162

Volume % Change: 79%

From a technical perspective, BKS is bouncing sharply to the upside here right off its 200-day moving average of $13.89 with above-average volume. This move is quickly pushing BKS within range of triggering a major breakout trade. That trade will hit once BKS manages to take out some key overhead resistance at $14.78 with high volume.

Traders should now look for long-biased trades in BKS as long as its trending above its 200-day, and then once it sustains a move or close above $14.78 with volume that hits near or above 963,162 shares. At last check, BKS has hit an intraday high of $14.80 and volume has started to push above its three-month average action of 963,162 shares. If BKS triggers that breakout soon, then look for this stock to re-test or possibly take out its next major overhead resistance levels at $17.68 to $19.58.

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.