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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.
Major moves in volume can signal unusual activity, such as
insider buying or
selling -- or buying or selling by "superinvestors."
>>5 Stocks Set to Soar on Bullish Earnings
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.>>5 Rocket Stocks to Buy for a 1Q RallyOverstock.comOverstock.com(OSTK - Get Report) is an online retailer offering closeout and discount brand and non-brand name merchandise, including bed-and-bath goods, home dcor, kitchenware, watches, jewelry, electronics and computers, apparel and designer accessories. This stock is trading up 4.8% at $15.45 in recent trading.
Today's Volume: 144,000
Average Volume: 146,411
Volume % Change: 129%
This stock is trading higher in front of its earnings report which is scheduled for Jan. 24, 2013, before the market opens.
From a technical perspective, OSTK is ripping right above its 50-day moving average of $14.55 with decent volume. This move has started to push shares of OSTK into breakout territory, since the stock has moved above some near-term overhead resistance levels at $15.06 to $15.56. Shares of OSTK are now moving within range of triggering another major breakout trade. That trade will hit if OSTK takes out some more overhead resistance at $16 with high volume. At last check, OSTK has hit an intraday high of $16.15 and volume is close to surpassing its three-month average action of 146,411 shares. That $16.15 level is a new 52-week high for OSTK.
Traders should now look for long-biased trades in OSTK as long as it's trending above $15.32 to $15.56, and then once it sustains a move or close above $16 to $16.15 with volume that hits near or above 146,411 shares. If that breakout triggers now or after earnings, then OSTK will set up to enter new 52-week high territory, which is bullish technical price action. Some possible upside targets off that breakout are $17 to $17.69. Any high-volume move above $17.69 could send OSTK towards $20 after earnings.