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.
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.
Must Read: 2 Big Stocks on Traders' Radars
With that in mind, let's take a look at several stocks rising on unusual volume recently.
TD Ameritrade (AMTD - Get Report) provides securities brokerage services and technology-based financial services to retail investors, traders and independent registered investment advisors in the U.S. This stock closed up 1.8% to $34.44 in Wednesday's trading session.
Wednesday's Volume: 5.06 million
Three-Month Average Volume: 2.65 million
Volume % Change: 72%
From a technical perspective, AMTD trended modestly higher here right above its 50-day moving average of $32.50 with above-average volume. This stock has been uptrending for the last month and change, with shares moving higher from its low of $29.78 to its recent high of $34.99. During that uptrend, shares of AMTD have been consistently making higher lows and higher highs, which is bullish technical price action. This spike higher on Wednesday is quickly pushing shares of AMTD within range of triggering a major breakout trade. That trade will hit if AMTD manages to take out some near-term overhead resistance levels at $34.99 to its 52-week high at $35.16 with high volume.
Traders should now look for long-biased trades in AMTD as long as it's trending above its 50-day at $32.50 and then once it sustains a move or close above those breakout levels with volume that hits near or above 2.65 million shares. If that breakout gets underway soon, then AMTD 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 $45.