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
-- or buying or selling by "superinvestors."
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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.
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(DORM - Get Report)
is a supplier of automotive replacement parts and fasteners and service line products mainly for the automotive aftermarket. This stock is trading up 5.8% at $36.75 in recent trading.
Today's Volume: 261,000
Average Volume: 128,617
Volume % Change: 240%
From a technical perspective, DORM is gapping higher here right off its 50-day moving average of $34.07 with above-average volume. This stock has been in a monster uptrend for the last six months, with shares soaring higher from its low of $28.05 to its recent high of $37.19. During that move, shares of DORM have been consistently making higher lows and higher highs, which is bullish technical price action. That move is quickly pushing DORM within range of triggering a major breakout trade. That trade will hit if DORM manages to take out its 52-week high of $37.19 with high volume.
Traders should now look for long-biased trades in DORM as long as it's trending above today's low of $36.24, and then once it sustains a move or close above $37.19 with volume that hits near or above 128,617 shares. If that breakout triggers soon, then DORM 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 $42.