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
-- 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.
With that in mind, let's take a look at
) is s a global Web services company whose business consists of online content, products and services that it offers to consumers, publishers and advertisers. This stock closed up 5.3% at $37.08 in Wednesday's trading session.
Wednesday's Volume: 2.61 million
Three-Month Average Volume: 1.32 million
Volume % Change: 155%
From a technical perspective, AOL spiked sharply higher here right off its 200-day moving average of $35.71 with strong upside volume. This move pushed shares of AOL into breakout territory, since the stock took out some near-term overhead resistance at $36.30. Shares of AOL are now quickly moving within range of triggering another big breakout trade. That trade will hit if AOL manages to clear Wednesday's high of $37.34, and then once it takes out some past overhead resistance at $38.40 to $38.48 with high volume.
Traders should now look for long-biased trades in AOL as long as it's trending above its 200-day at $35.71 or above $35 and then once it sustains a move or close above those breakout levels with volume that's near or above 1.32 million shares. If that breakout triggers soon, then AOL will set up to re-test or possibly take out its next major overhead resistance levels at $42.12 to its 52-week high at $43.93.
) is a global Internet media company that informs over 24 million subscribers worldwide, as well as millions of Web site users, about the best travel and entertainment deals available from thousands of companies. This stock closed up 4.3% at $21.63 in Wednesday's trading session.
Wednesday's Volume: 129,000
Three-Month Average Volume: 64,065
Volume % Change: 135%
From a technical perspective, TZOO spiked sharply higher here right above its recent low of $20.20 with above-average volume. This stock has been downtrending badly for the last three months and change, with shares dropping sharply from its high of $33.95 to its recent low of $20.20. During that move, shares of TZOO have been consistently making lower highs and lower lows, which is bearish technical price action. That said, shares of TZOO have now entered oversold territory, since its current relative strength index reading is 30.31. Oversold can always get more oversold, but it's also an area where a stock can experience a powerful bounce higher from.
Traders should now look for long-biased trades in TZOO as long as it's trending above its recent low of $20.20 and then once it sustains a move or close above Wednesday's high of $21.75 to $22.50 with volume that's near or above 64,065 shares. If we get that move soon, then TZOO will set up to re-test or possibly take out its next major overhead resistance levels at $24 to its 200-day at $25.45, or its 50-day at $26.81.
) delivers supply chain solutions to customers in the communications, consumer, enterprise computing and diversified end markets. This stock closed up 7.4% to $11.27 in Wednesday's trading session.
Wednesday's Volume: 1.42 million
Three-Month Average Volume: 336,914
Volume % Change: 310%
From a technical perspective, CLS ripped sharply higher here right above some near-term support at $10.35 and back above its 50-day moving average of $10.97 with heavy upside volume. This move is quickly pushing shares of CLS within range of triggering a big breakout trade. That trade will hit if CLS manages to take out Wednesday's high of $11.42 and its 52-week high of $11.49 with high volume.
Traders should now look for long-biased trades in CLS as long as it's trending above its 50-day at $10.97 or above Wednesday's low of $10.61 and then once it sustains a move or close above those breakout levels with volume that hits near or above 336,914 shares. If that breakout triggers soon, then CLS will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $14 to $15.
To see more stocks rising on unusual volume, check out the
portfolio on Stockpickr.
-- Written by Roberto Pedone in Delafield, Wis.
Follow Stockpickr on
and become a fan on
At the time of publication, author had no positions in stocks mentioned. Roberto Pedone, based out of Delafield, Wis., is an independent trader who focuses on technical analysis for small- and large-cap stocks, options, futures, commodities and currencies. Roberto studied international business at the Milwaukee School of Engineering, and he spent a year overseas studying business in Lubeck, Germany. His work has appeared on financial outlets including
. You can follow Pedone on Twitter at www.twitter.com/zerosum24 or @zerosum24.