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.
>>5 Stocks Under $10 Set to Soar
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.
>>5 Big Trades to Take in December
With that in mind, let's take a look at several stocks rising on unusual volume today.
Shenandoah Telecommunications
Shenandoah Telecommunications (SHEN) provides integrated voice, video and data communications services to end-user customers and other communications providers. This stock closed up 3.6% at $24.18 in Friday's trading session.
Friday's Volume: 184,000
Three-Month Average Volume: 115,970
Volume % Change: 65%
From a technical perspective, SHEN spiked higher here with above-average volume. This stock just formed a double bottom chart pattern, since buyers stepped in to support the stock over the last month at $22.17 and at $22.19. Shares of SHEN have now started to spike higher off $22.19 and it's quickly moving within range of triggering a near-term breakout trade. That trade will hit if SHEN manages to take out some near-term overhead resistance levels at its 50-day moving average of $25.19 to more near-term overhead resistance at $25.44 with high volume.
Traders should now look for long-biased trades in SHEN as long as it's trending above Friday's low of $23.23 or above more support at $22.19 and then once it sustains a move or close above those breakout levels with volume that's near or above 115,970 shares. If that breakout hits soon, then SHEN will set up to re-test or possibly take out its next major overhead resistance levels at $27.02 to its 52-week high at $29.15.
Western Refining
Western Refining (WNR) is a crude oil refiner and marketer of refined products. It also operates service stations and convenience stores. This stock closed up 3.6% at $39.03 in Friday's trading session.
Friday's Volume: 4.25 million
Three-Month Average Volume: 1.56 million
Volume % Change: 187%
From a technical perspective, WNR trended higher here right above some near-term support at $37.10 with above-average volume. This stock recently formed a double bottom chart pattern, after buyers came in to support the stock at $36.91 and $37.10. Since marking that bottom, shares of WNR have started to spike higher and move within range of triggering a big breakout trade. That trade will hit if WNR manages to take out Friday's high of $39.41 to its 52-week high at $40.95 with high volume.
Traders should now look for long-biased trades in WNR as long as it's trending above Friday's low of $37.90 and then once it sustains a move or close above those breakout levels with volume that this near or above 1.56 million shares. If that breakout hits soon, then WNR will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $45 to $48.
Omega Protein
Omega Protein (OME) produces and sells a number of protein and oil products derived from menhaden, including fish meal, fish oil and fish soluble. This stock closed up 6.8% to $13.98 in Friday's trading session.
Friday's Volume: 425,000
Three-Month Average Volume: 171,761
Volume % Change: 175%
From a technical perspective, OME ripped sharply higher here right above some near-term support at $13 with strong upside volume. This move is quickly pushing shares of OME within range of triggering a big breakout trade. That trade will hit if OME manages to take out some near-term overhead resistance levels at $14.50 to its 52-week high at $15.27 with high volume.
Traders should now look for long-biased trades in OME as long as it's trending above Friday's low of $13.25 or above $13 and then once it sustains a move or close above those breakout levels with volume that hits near or above 171,761 shares. If that breakout hits soon, then OME will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that move are $17 to $20.
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.
RELATED LINKS:
>>Timing the Fed's Taper
>>5 Rocket Stocks to Buy in December
>>5 Breakout Stock Trades for a Santa Claus Rally
Follow Stockpickr on Twitter and become a fan on Facebook.
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.
No comments:
Post a Comment