DELAFIELD, Wis. (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.
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Major moves in volume can signal unusual activity, such as insider buying or selling -- or buying or selling by "superinvestors."
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.
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With that in mind, let's take a look at several stocks rising on unusual volume recently.
CBS Outdoor Americas
CBS Outdoor Americas (CBSO) leases advertising space on out-of-home advertising structures and sites in the U.S., Canada and Latin America. This stock closed up 4.4% at $34.52 in Monday's trading session.
Monday's Volume: 6.33 million
Three-Month Average Volume: 3.65 million
Volume % Change: 126%
From a technical perspective, CBSO gapped sharply higher here and broke out above some near-term overhead resistance at $33.50 with strong upside volume flows. This strong move to the upside with volume on Monday is quickly pushing shares of CBSO within range of triggering a major breakout trade. That trade will hit if CBSO manages to take out Monday's intraday high of $34.58 to its all-time high of $35.69 with high volume.
Traders should now look for long-biased trades in CBSO as long as it's trending above Monday's intraday low of $33.54 or above its 50-day moving average at $32.53 and then once it sustains a move or close above those breakout levels with volume that's near or above 3.65 million shares. If that breakout gets set off soon, then CBSO will set up to enter new all-time-high territory above $35.69, which is bullish technical price action. Some possible upside targets off that breakout are $40 to $45 or even $50.
iStar Financial
iStar Financial (STAR) operates as a finance and investment company focusing on the commercial real estate industry in the U.S. This stock closed up 1.4% at $14.81 in Monday's trading session.
Monday's Volume: 1.05 million
Three-Month Average Volume: 573,233
Volume % Change: 90%
From a technical perspective, STAR jumped notably higher here right off its 50-day moving average of $14.57 with above-average volume. This stock has been making higher lows over the last three months, which demonstrates that buyers are paying up to own shares of STAR whenever it pulls back. This modest spike higher on Monday is starting to push shares of STAR within range of triggering a big breakout trade. That trade will hit if STAR manages to take out Monday's intraday high of $14.85 to some more key overhead resistance levels at $15 to $15.19 with high volume.
Traders should now look for long-biased trades in STAR as long as it's trending above its 50-day at $14.57 or above more support at $14.26 and then once it sustains a move or close above those breakout levels with volume that's near or above 573,233 shares. If that breakout materializes soon, then STAR will set up to re-test or possibly take out its 52-week high at $15.91. If that level gets taken out with volume, then STAR could easily trend towards $18 to $20.
Flotek Industries
Flotek Industries (FTK) develops and supplies drilling, completion and production technologies and related services in the U.S. and internationally. This stock closed up 2.1% at $31.80 in Monday's trading session.
Monday's Volume: 726,000
Three-Month Average Volume: 586,883
Volume % Change: 50%
From a technical perspective, FTK trended notably higher here right above its 50-day moving average of $30.11 with above-average volume. This stock has been uptrending for the last two months and change, with shares moving higher from its low $26.75 to its recent high of $32.92. During that uptrend, shares of FTK have been making mostly higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of FTK within range of triggering a big breakout trade. That trade will hit if FTK manages to take out Monday's intraday high of $32.09 to its 52-week high at $32.92 with high volume.
Traders should now look for long-biased trades in FTK as long as it's trending above its 50-day at $30.11 or above some more near-term support at $29.39 and then once it sustains a move or close above those breakout levels with volume that's near or above 586,883 shares. If that breakout begins soon, then FTK will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $40 to $45.
Gas Natural
Gas Natural (EGAS) is engaged in the distribution and sale of natural gas to residential, commercial and industrial customers. This stock closed up 4.5% at $11.64 in Monday's trading session.
Monday's Volume: 468,000
Three-Month Average Volume: 163,179
Volume % Change: 494%
From a technical perspective, EGAS jumped notably higher here with heavy upside volume flows. This stock recently broke out above some key overhead resistance levels at $10.99 to $11.20 with strong upside volume. Shares of EGAS have now pulled back to right around those breakout levels and it has started to rip higher again with strong volume. That move is quickly pushing shares of EGAS within range of triggering another big breakout trade. That trade will hit if EGAS manages to take out Monday's intraday high of $11.73 to its 52-week high at $12.57 with high volume.
Traders should now look for long-biased trades in EGAS as long as it's trending above Monday's intraday low of $11 and then once it sustains a move or close above those breakout levels with volume that's near or above 163,179 shares. If that breakout kicks off soon, then EGAS will set up to enter new 52-week-high territory above $12.57, which is bullish technical price action. Some possible upside targets off that breakout are $14 to $15.
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To see more stocks rising on unusual volume, check out the Stocks Rising on Unusual Volume portfolio on Stockpickr.
-- Written by Roberto Pedone in Delafield, Wis.
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At the time of publication, author had no positions in stocks mentioned.
Roberto Pedone, based out of Delafield, Wis., 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.
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