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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. Many times when above average volume moves into 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.
Apple (AAPL) is engaged in designing, manufacturing and marketing mobile communication and media devices, personal computers and portable digital music players. This stock is trading up 2.2% at $662.91 in recent trading.
Today’s Volume: 10.1 million
Average Volume: 14.2 million
Volume % Change: 56%
From a technical perspective, AAPL is ripping to the upside here right off some near-tem support at $650 with decent volume. This move is coming after AAPL broke out last week above some past overhead resistance at $641.25 with decent volume.
Traders should now look for long-biased trades as long as AAPL is trending above today’s low of $649.90 with strong upside volume flows. I would consider any upside volume day that registers near or above 14,243,100 shares as bullish. If we continue to see that trend, then AAPL should continue to make new all-time highs and eventually hit $700 in the near future.
Keep in mind that AAPL is starting to enter overbought territory, since its current relative strength index reading is 78.54. Overbought can stay overbought for awhile, so make sure to focus more on the price action and volume here.
Apple shows up on a recent list of 4 Stocks to Buy and Forget for 4 Years.
First Solar (FSLR) manufactures and sells solar modules with an advanced thin-film semiconductor technology, and it designs, constructs and sells photovoltaic solar power systems. This stock is trading up 8% at $22.98 in recent trading.
Today’s Volume: 5 million
Average Volume: 6.1 million
Volume % Change: 50%
From a technical perspective, FSLR is ripping sharply higher here with decent volume. This move has pushed FSLR into near-term breakout territory, since the stock has blasted above some near-term overhead resistance at $22.12.
Traders should now look for long-biased trades in FSLR as long as its trending above today’s low of $21.02 with strong upside volume flows. You could even give FSLR room down to its recent support zone at $19.56, but today’s low should hold if this breakout has legs. I would consider any upside volume day that registers near or above 6.1 million shares as bullish. If FSLR can hold this trend, then look for the stock to re-test or possibly take out its next major overhead resistance levels at $23.88 to its 200-day moving average of $27.56.
On the flipside, I would avoid FSLR or look for short-biased trades if it fails to hold that trend, and then takes out $19.56 with heavy volume.
Oplink Communications (OPLK) designs, manufactures and sells optical networking components and subsystems. This stock is trading up 3.6% at $16.90 in recent trading.
Today’s Volume: 191,000
Average Volume: 124,802
Volume % Change: 169%
From a technical perspective, OPLK is moving modestly higher here with above average volume. This move follows a monster spike in this stock during the last couple of trading sessions, which has taken shares from around $13.50 to today’s high of $17.62. That huge spike has also pushed OPLK into overbought territory, since its current relative strength index reading is now 82.08.
Traders should now only look for long-biased trades in OPLK if it holds today’s low of $16.34, or if it takes out some major past overhead resistance at $17.85 with high volume. I would consider any upside volume day that registers near or above 124,802 shares as bullish. On the flipside, I would avoid OPLK or look for short-biased trades if it moves back below its 200-day moving average at $15.60 with heavy volume. A high-volume move below that level will setup OPLK to re-fill its recent gap.
NetEase (NTES) provides its Internet and wireless value-added applications, services and technologies and advertising services to Guangzhou NetEase and Guangyitong Advertising and they operate the NetEase Websites and the online advertising business. This stock is trading up 1.2% at $48.84 in recent trading.
Today’s Volume: 546,000
Average Volume: 764,830
Volume % Change: 50%
From a technical perspective, NTES is moving modestly higher here with decent volume. This move follows a massive drop in this stock from last week that took shares down from $58.20 to its recent low of $47.51 with heavy volume.
Traders should now look for long-biased trades if NTES takes out Friday’s high of $49.38 with high volume. Look for a sustained move or close above $49.38 with volume that’s near or above 764,830 shares. If we get that action today or soon, then look for NTES to possibly make a run at its 200-day moving average of $53.06.
On the flipside, I would avoid NTES or look for short-biased trades if it fails to trigger that move, and then takes out its recent low of $47.51 with heavy volume. A high-volume move below $47.51 will setup NTES to re-test or take out its past support levels at $46.60 to $45.
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 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.