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.
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.>>Book Double the Gains With These 5 Shareholder Yield Champs With that in mind, let's take a look at several stocks rising on unusual volume recently. Timken (TKR - Get Report) engineers, manufactures and markets mechanical components, bearings, and engineered steel bars and tubes worldwide. This stock closed up 3.1% at $49.73 in Wednesday's trading session. Wednesday's Volume: 2.49 million
Three-Month Average Volume: 1.10 million
Volume % Change: 271% From a technical perspective, TKR ripped higher here right above some near-term support at $47.61 with above-average volume. This spike higher on Wednesday briefly pushed shares of TKR into breakout territory, since the stock flirted with its former 52-week high at $49.76. Shares of TKR tagged an intraday high of $49.83, before closing just below that level at $49.73. Market players should now look for a continuation move to the upside in the short-term if TKR manages to take out its new 52-week high at $49.83 with strong upside volume flows. Traders should now look for long-biased trades in TKR as long as it's trending above Wednesday's low of $47.96 or above its 50-day at $46.25 and then once it sustains a move or close above $49.83 with volume that this near or above 1.10 million shares. If that move gets set off soon, then TKR will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that move are $55 to $60.