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7 Stocks Soaring on Monster 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. 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.
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Tesla Motors (TSLA) designs, develops, manufactures and sells electric vehicles and advanced electric vehicle powertrain components. This stock is trading up 5.6% at $33.90 in recent trading.
Today’s Volume: 2.1 million
Average Volume: 1.2 million
Volume % Change: 271%
Shares of TSLA are moving notably higher today after an analyst at Goldman Sachs lifted the price target on the stock to $50, citing positive catalysts including the highly-anticipated launch of the Model S sedan.
From a technical perspective, TSLA is gapping up strong here with above average volume. This move is coming after TSLA broke back above both its 50-day and 200-day moving averages just a few trading sessions ago.
Now shares of TSLA are approaching a near-term breakout trade. That trade will hit once TSLA takes out some near-term overhead resistance levels at $34.68 to $35.49 with high volume. That $35.49 level is the gap-down day high for the stock form back in April.
Traders should now look for long-biased trades if TSLA can sustain a move or close above those levels with volume that’s near or above 1.2 million shares. If we get that action soon, then TSLA could possibly re-test and take out its all-time high of $39.95.
Sodastream (SODA), along with its subsidiaries, is engaged in developing, manufacturing and marketing home beverage carbonation systems and related products. This stock is trading up 5.3% at $37.31 in recent trading.
Today’s Volume: 1.4 million
Average Volume: 1.1 million
Volume % Change: 157%
Shares of SODA are ripping higher today after Monness Crespi maintained its buy rating on the stock with a $70 price target. In a research report, Monness Crespi writes, “The company has a strong balance sheet with $2.60 per share in net cash and, to date, management has executed exceptionally well. We believe the company will continue to beat estimates in 2012 and the stock will ultimately follow earnings higher.”
From a technical perspective, SODA is soaring back above its 200-day moving average of $33.55 here with above-average volume. This move has also pushed SODA into breakout territory since the stock has taken out $36.09.
Traders should now watch for the next major breakout trade to trigger. That trade will hit once SODA takes out some near-term overhead resistance at $37.95 to $38.80 with high volume. Traders should look for long-biased trades if SODA can maintain a move or close above those levels with volume that’s near or above 1.1 million shares. If we get that action soon, look for SODA to hit $42 to $44 or possibly higher.
Check Point Software Technologies
Check Point Software Technologies (CHKP) develops technologies to communications and transactions over the Internet by enterprises and consumers. This stock is trading up 4% at $50.61 in recent trading.
Today’s Volume: 2.4 million
Average Volume: 2.1 million
Volume % Change: 106%
From a technical perspective, CHKP is bouncing perfectly off of some longer-term support here at around $48 with heavy volume. This stock has plunged in the last two months from a high of $65 to a recent low of $48.06. During that sharp move lower, shares of CHKP have consistently made lower highs and lower lows, which is bearish technical price action. That said, CHKP might be setting up to form a double bottom if it can manage to hold around $48.06 to $47.79.
Traders should now look for long-biased trades as long as CHKP can sustain a trend above those levels with strong upside volume flows. I would consider any upside volume day that registers near or above 2.1 million shares as bullish.
Keep in mind that if CHKP can manage to take out $54.15 to $55.12, then it will break the pattern of higher lows and print a higher high.
Idenix pharmaceuticals (IDIX) is a biopharmaceutical company engaged in the discovery and development of drugs for the treatment of human viral diseases with operations in the U.S. and Europe. This stock is trading up 16.2% at $10.89 in recent trading.
Today’s Volume: 4.8 million
Average Volume: 1.5 million
Volume % Change: 565%
Shares of IDIX are skyrocketing higher today after the company reported positive mid-stage trial date for its hepatitis C drug, suggesting it was closer to competing with larger drugmakers. Data from the trial showed that nearly all patients who responded to Idenix’s experimental treatment were able to sustain their defense against the virus.
From a technical perspective, IDIX is gapping up huge here with monster volume. This move has pushed IDIX into breakout territory since the stock has taken out some near-term overhead resistance at $10.40 to $10.43.
Traders should look for long-biased trades if this breakout holds, and if IDIX can trigger its next major breakout trade. That trade will hit once IDIX takes out some more overhead resistance at $11.92 to $12.68 with high volume. Look for a sustained move or close above those levels with volume that’s near or above 1.5 million shares. If we get that action soon, then IDIX could easily re-test and possibly take out its 2012 high of $15.25.
On the flipside, I would avoid long-biased trades if IDIX fails to hold that breakout above $10.40 to $10.43.
Medidata Solutions (MDSO) is a global provider of software-as-a-service, clinical technology solutions. This stock is trading up 4.6% at $30.13 in recent trading.
Today’s Volume: 226,000
Average Volume: 178,642
Volume % Change: 50%
From a technical perspective, MDSO is moving sharply higher here on above-average volume, and the stock has started to flirt with a major breakout trade. Shares of MDSO have started to take out some near-term overhead resistance at $29.27 to $29.65 with high volume. This move has pushed MDSO into new 52-week-high territory, which is bullish technical action.
Traders should now continue to look for long-biased trades as long as MDSO is trending above those breakout levels of $29.27 to $29.65 with strong upside volume flows. I would consider any upside volume day that registers near or above 178,642 shares as bullish. If we continue to see that trend, then MDSO has a great chance of tagging $35 in the near future.
Carrizo Oil & Gas
Carrizo Oil & Gas (CRZO) is an independent energy company. Carrizo together with its subsidiaries is engaged in the exploration, development, and production of oil and gas in the U.S. and U.K. This stock is trading up 1.6% at $21.08 in recent trading.
Today’s Volume: 1 million
Average Volume: 1.2 million
Volume % Change: 63%
From a technical perspective, CRZO is bouncing modestly here off a recent low of near $19.24 with decent volume. This stock has been hammered by the sellers during the last two months, with shares dropping from a high of $31.32 to a recent low of $19.24. During that slide, shares of CRZO have consistently made lower highs and lower lows, which is bearish technical price action.
This bounce today is now pushing CRZO within range of a near-term breakout trade. That trade will trigger once CRZO takes out some near-term overhead resistance at $22.48 with high volume.
Traders should now look for long-biased trades if CRZO can sustain a move or close above $22.48 with volume that’s near or above 1.2 million shares. If we get that action soon, look for CRZO to possibly re-test its 50-day moving average at $24.83 or its 200-day at $26.11.
Pharmacyclics (PCYC) is a clinical-stage biopharmaceutical company focused on developing and commercializing small-molecule drugs for the treatment of cancer and immune mediated diseases. This stock is trading up 3.6% at $44.22 in recent trading.
Today’s Volume: 683,000
Average Volume: 803,900
Volume % Change: 50%.
From a technical perspective, PCYC is surging higher here with decent volume. This move has pushed PCYC into new 52-week-high territory, which is bullish technical price action. That said, shares of PCYC are starting to enter extremely overbought territory as well, since its current relative strength index reading is now 85.56. Overbought can always get more overbought, but keep in mind that this stock has soared in the last six months from $15.70 to over $44.
Traders would probably be better served to wait for PCYC to work off some of these overbought conditions, and start to form a new base, before looking for buying opportunities. That said, if PCYC continues to tag new 52-week highs, then in the short-term it could easily hit $50.
Pharmacyclics shows up on a list of Hot Biotech Stocks Traded by Hedge Funds.
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.