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 Ready for Breakouts
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 Toxic Stocks to Sell Now
With that in mind, let's take a look at several stocks rising on unusual volume recently.
TE Connectivity
TE Connectivity (TEL), together with its subsidiaries, designs and manufactures products that connect power, data and signal automotive, energy, industrial, broadband communications, consumer devices, aerospace and defense and health care industries. This stock closed up 1.5% to $60.16 in Friday's trading session.
Friday's Volume: 4.44 million
Three-Month Average Volume: 1.79 million
Volume % Change: 130%
From a technical perspective, TEL gapped up modestly higher here and broke out above some near-term overhead resistance at $60.03 with above-average volume. This move is quickly pushing shares of TEL within range of triggering another breakout trade. That trade will hit if TEL manages to take out Friday's high of $60.73 to its 52-week high at $61.14 with high volume.
Traders should now look for long-biased trades in TEL as long as it's trending above Fridays low of $59.49 or above $58 and then once it sustains a move or close above those breakout levels with volume that hits near or above 1.79 million shares. If that breakout gets underway soon, then TEL will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $65 to $70.
Newfield Exploration
Newfield Exploration (NFX), an independent energy company, is engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. This stock closed up 5.9% at $30.08 in Friday's trading session.
Friday's Volume: 6.46 million
Three-Month Average Volume: 2.88 million
Volume % Change: 109%
From a technical perspective, NFX ripped higher here right above some near-term support at $28 with above-average volume. This move pushed shares of NFX into breakout territory, since the stock took out some near-term overhead resistance at $29.20. Market players should now look for a continuation move higher in the short-term if NFX manages to take out Friday's high of $30.24 with high volume.
Traders should now look for long-biased trades in NFX as long as it's trending above Friday's low of $28.52 or above $28 and then once it sustains a move or close above $30.24 with volume that hits near or above 2.88 million shares. If that move materializes soon, then NFX will set up to re-test or possibly take out its next major overhead resistance levels at its 52-week high of $32.55 to $35.
Eastman Kodak
Eastman Kodak (KODK), a technology company, provides products and services in entertainment imaging and commercial films worldwide. This stock closed up 4.5% to $28.73 in Friday's trading session.
Friday's Volume: 453,000
Three-Month Average Volume: 62,792
Volume % Change: 420%
From a technical perspective, KODK jumped higher here with heavy upside volume. This move is quickly pushing shares of KODK within range of triggering a near-term breakout trade. That trade will hit if KODK manages to take out some near-term overhead resistance levels at $29.06 to its 50-day moving average at $29.78 and then once it takes out more resistance at $30.90 with high volume.
Traders should now look for long-biased trades in KODK as long as it's trending above Friday's low of $27 or above $26 and then once it sustains a move or close above those breakout levels with volume that hits near or above 62,792 shares. If that breakout kicks off soon, then KODK will set up to re-test or possibly take out its next major overhead resistance levels at $34 to $35, or even its 52-week high at $37.73.
Team
Team (TISI) provides specialty industrial services in the U.S. and internationally. This stock closed up 6.4% at $44.40 in Friday's trading session.
Friday's Volume: 207,000
Three-Month Average Volume: 99,461
Volume % Change: 235%
From a technical perspective, TISI spiked sharply higher here right above some near-term support at $41.49 with above-average volume. This move pushed shares of TISI into breakout territory, since the stock took out its 50-day moving average of $43.79 and some near-term resistance at $44.15. Shares of TISI are now quickly moving within range of triggering another near-term breakout trade. That trade will hit if TISI manages to take out Friday's high of $44.74 to some more near-term overhead resistance at $45 with high volume.
Traders should now look for long-biased trades in TISI as long as it's trending above $43 or $42 and then once it sustains a move or close above those breakout levels with volume that this near or above 99,461 shares. If that breakout triggers soon, then TISI will set up to re-test or possibly take out its next major overhead resistance levels at $47 to its 52-week high at $48.09.
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:
>>5 Stocks Under $10 to Trade for Breakouts
>>5 Stocks Insiders Love Right Now
>>5 Big Trade Signals After Yellen's Surprise Message
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