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. 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
-- 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 today.
(HLF - Get Report)
This is a marketing company that sells weight management, nutritional supplement, energy, sports and fitness products and personal care products. This stock is trading up 7.6% at $28.04 in recent trading.
Today's Volume: 9.16 million
Average Volume: 3.57 million
Volume % Change: 512%
Shares of HLF are soaring today after the company said it would hold an analyst and investor meeting on Jan. 10 at 9:00 a.m. in New York, which will be a comprehensive response to investor questions on its business model.
From a technical perspective, HLF is bouncing strongly to the upside here off oversold levels with heavy volume. Shares of HLF have plunged during the last few weeks from $47.45 to its recent low of $24.24. That move has pushed HLF into oversold territory, since its relative strength index (RSI) reading is now 18.05. Oversold can always get more oversold, but it's also an area where a stock can experience a powerful snapback rally.
Traders should now look for long-biased trades in HLF as long as it's trending above today's low of $26.31 with strong upside volume flows. I would consider any upside volume day that registers near or above its three-month average volume of 3.57 million shares as bullish. If HLF can maintain that trend above $26.31 with strong volume, then this stock has a great chance to rebound back above $32.50 in the near future.