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. Many times when above average volume moves into 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.
Let's take a look at a
. They are all recording volume in midday trading that is tracking well above their average daily trading volume.
is a biotechnology company focused on the discovery, development and commercialization of therapeutics that may improve cancer treatment options for patients. The stock is trading up 8.9% at $13.45 in recent trading.
Today's Volume: 18 million
Average Volume: 6.8 million
Volume % Change: 268%
, shares of DNDN are very close to triggering a big breakout trade if this stock can manage to sustain a move and close above some past overhead resistance at $13.95. A
and close over $13.95 will push DNDN into position to start filling its massive gap down from back in August of 2010 from over $30.
Volume today is already well above its average action, so watch for a close over $13.95.
, a biopharmaceutical company, provides prescription drugs for the treatment of auto-immune diseases. The stock is trading up 8% at $42.11 in recent trading.
Today's Volume: 2.4 million
Average Volume: 1.1 million
Volume % Change: 241%
Shares of QCOR are ripping higher today after the company announced sales of its H.P. Acthar Gel that exceeded analyst expectations. The company shipped 3,360 vial of the gel vs. 1,680 shipped in the fourth quarter of 2010.
From a technical standpoint, QCOR is starting to gap up big today back above its 50-day
of $42.25 on heavy volume. Traders should now watch for a sustained move and close above $42.25 to signal that this stock wants to re-test some major overhead resistance at close to $46.
I would consider it a major breakout if QCOR can take out $46 with volume in the coming days or weeks.
Questcor shows up on recent lists of
is an Internet subscription service streaming television shows and movies. The stock is trading up 6% at $92.29 in recent trading.
Today's Volume: 13.3 million
Average Volume: 8.45 million
Volume % Change: 222%
Shares of NFLX are soaring higher today after the company said it will begin its push into the U.K. and Ireland, marking the start of a European expansion that will push it into a loss this year but will attract new customers in the long run.
From a technical standpoint, NFLX is approaching another big breakout trade if the stock can manage to take out some past overhead resistance at $93.84 with volume. Volume today is already well above the average action and the stock has already hit a daily high of $93.58.
A move and close over $93.84 with volume should be considered very bullish since this will bring a large gap down from $120 into play from back in October of 2010.
Netflix, one of TheStreet Ratings'
, shows up on a list of
but was also featured recently in "
is a global medical device company focused on surgeons that treat musculoskeletal injuries and disorders of the shoulder, elbow, wrist, hand, ankle and foot. This stock is trading up 5.5% at $18.43 in recent trading.
Today's Volume: 225,000
Average Volume: 124,544
Volume % Change: 189%
Shares of Tornier N.V. are surging higher today after the company announced preliminary fourth-quarter sales gains of 12.7% and full-year 2011 sales gains of 14.9%.
, TRNX has started to challenge its 50-day moving average of $18.67 today on high volume. Market players should now watch for a sustained high-volume move and close above $18.67 and then $18.72 to trigger a
If we get that action soon, then look for TRNX to challenge $20 to $22.32 (its 200-day) if the volume continues to track in strong on the up days.
develops, manufactures, sells and licenses oscilloscopes and communication protocol analyzers. This stock is trading up 13.8% at $10.79 in recent trading.
Today's Volume: 172,000
Average Volume: 96,168
Volume % Change: 177%
Shares of LCRY are moving sharply to the upside today after the company reported second quarter EPS and revenue that were in line and announced plans to repurchase 5 million shares.
From a technical standpoint, LCRY has started to trade back above its 200-day
of $10.25 today on heavy volume. Market players should now watch for an even bigger breakout trade to trigger if LCRY can take out some overhead
at $10.75 to $11.21 with volume.
Look for volume on a move and close above those levels that's near or above 96,168 shares to signal that this stock wants to trade back toward its next significant overhead resistance level at $12.96 in the near future.
is engaged in development and commercialization of therapeutic drugs for large underserved markets, including obesity and related morbidities, such as sleep apnea and diabetes and men's sexual health. This stock is trading up 11.8% at $11.36 in recent trading.
Today's Volume: 2.9 million
Average Volume: 1.5 million
Volume % Change: 173%
From a technical standpoint, VVUS is gapping up huge today with volume above some near-term overhead resistance at $10.79. Traders should now watch for a sustained high-volume move and close above its next significant overhead resistance at $11.48.
If we get that action soon, then look for VVUS to challenge $12.98 to $13.68 in the coming days of weeks. Keep in mind that it will be important for VVUS to stay above $11.48 if there's any chance of a re-test of $12.98 to $13.68.
To see more stocks rising on unusual volume, including
, check out the
portfolio on Stockpickr.
-- Written by Roberto Pedone in Winderemere, Fla.
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At the time of publication, author had no positions in stocks mentioned.
Roberto Pedone, based out of Windermere, Fla., is an independent trader who focuses on stocks, options, futures, commodities and currencies. He is also an outside contributor to Beconequity.com and maintains the website Maddmoney.net, which he sold to Blue Wave Advisors in 2008. Roberto studied International Business at The Milwaukee School of Engineering, and he spent a year overseas studying business in Lubeck, Germany.