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4 Stocks Rising on Big Volume - views
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.
Five Below (FIVE) is a rapidly growing specialty value retailer offering a broad range of trend-right, high-quality merchandise targeted at the aspirational teen and pre-teen customer. This stock closed up 4% at $37.34 on Wednesday.
Wednesday's Volume: 6.88 million
Average Volume: 290,049
Volume % Change: 2101%
Shares of FIVE trended up after the company boosted its secondary offering size to 11.3 million shares, priced at $35.65 per share.
From a technical perspective, FIVE is trending higher here and breaking out above some near-term overhead resistance at $36.36 with monster volume. This move is starting to push shares of FIVE within range of triggering another near-term breakout trade. That trade will hit if FIVE manages to take out some more near-term overhead resistance at $37.85 with high volume.
Traders should now look for long-biased trades in FIVE as long as it’s trending above today’s low of $36, and then once it sustains a move or close above $37.85 with volume that hits near or above 290,049 shares. If that breakout triggers soon, then FIVE will set up to re-test or possibly take out its 52-week high of $40. Any high-volume move above $40 will then push FIVE into new 52-week-high territory and all-time territory, which is bullish technical price action. Some possible upside targets off that breakout are $42 to $45 in the near future.
Arthur J. Gallagher
Arthur J. Gallagher (AJG) and its subsidiaries are engaged in providing insurance brokerage and third-party claims settlement and administration services to entities in the U.S. and abroad. This stock closed up 1.3% at $36.31 on Wednesday.
Wednesday's Volume: 2.33 million
Average Volume: 593,788
Volume % Change: 274%
Shares of AJG trended up after the company reported revenue of $630.4 million for the fourth quarter of 2012, a 14.3% increase over what the firm reported in the same period the previous year.
From a technical perspective, AJG gapped higher here right above its 50-day moving average of $35.68 with heavy upside volume. This move is quickly pushing shares of AJG within range of triggering a major breakout trade. That trade will hit if AJG manages to take out some key overhead resistance levels at $36.85 to $36.87 and then once it clears more past resistance at $37.16 with high volume.
Traders should now look for long-biased trades in AJG as long as it’s trending above its 50-day moving average of $35.68, and then once it sustains a move or close above those breakout levels with volume that hits near or above 593,788 shares. If that breakout triggers soon, then AJG will set up to enter new 52-week-high territory once it takes out $38.24. Some possible upside targets off any move above $38.24 are $40 to $43 in the near future.
Multimedia Games (MGAM) designs, manufactures and supplies standalone and networked gaming systems to Native American and commercial casino operators. This stock closed up 17% at $16.72 on Wednesday.
Wednesday's Volume: 1.12 million
Average Volume: 184,844
Volume % Change: 489%
Shares of MGAM skyrocketed higher after the company easily beat Wall Street earnings estimates by 11 cents per share, beat on revenues and raised its fiscal 2013 EPS and revenue guidance above consensus.
From a technical perspective, MGAM gapped up here right above its 50-day moving average of $14.32 with massive upside volume. This move has started to push shares of MGAM into breakout territory and new 52-week high territory, since the stock has taken out some past overhead resistance at $16.76. At last check, MGAM hit an intraday high of $17.43 and closed well above its daily low of $15.31.
Traders should now look for long-biased trades in MGAM as long as it’s trending above today’s low of $15.31 with strong upside volume flows. I would consider any upside volume day that registers near or above its three-month average action of 184,844 shares as bullish. If MGAM can maintain that trend, then this stock will have a great chance of tagging $20 or higher in the near future.
Isis Pharmaceuticals (ISIS) is engaged in antisense drug discovery and development, exploiting a novel drug discovery platform it created to generate a broad pipeline of first-in-class drugs. This stock closed up 9.7% at $14.69 on Wednesday's.
Wednesday's Volume: 8.86 million
Average Volume: 1.51 million
Volume % Change: 499%
Shares of ISIS soared higher after the FDA approved its newest gene-silencing drug, Kynamro. The drug treats a rare, inherited disorder that causes extremely high cholesterol levels by shutting down the gene’s ability to send messages that propagate the disorder.
From a technical perspective, ISIS gapped higher right above some near-term support at $13 with monster upside volume. This move pushed shares of ISIS into breakout territory, since the stock cleared some near-term overhead resistance at $14.45.
ISIS hit an intraday high of $15.60 on Wednesday and closed above that near-term breakout level of $14.45. Shares of ISIS are now moving within range of triggering another major breakout trade. That trade will hit if ISIS manages to clear its 52-week high of $15.61 with high volume.
Traders should now look for long-biased trades in ISIS as long as it’s trending above today’s low of $14.27, and then once it sustains a move or close above $15.61 with volume that hits near or above 1.51 million shares. If that breakout hits soon, then ISIS will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $18 to $20 in the near future.
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.
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 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.