5 Stocks Triggering Breakout Trades

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.

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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.

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With that in mind, let's take a look at several stocks rising on unusual volume today.

WGL Holdings

WGL Holdings ( WGL) sells and delivers natural gas and provides a variety of energy-related products and services to customers mainly in the District of Columbia and the surrounding metropolitan areas in Maryland and Virginia. This stock closed up 1.3% to $45.67 in Friday's trading session.

Friday's Volume: 1.18 million
Three-Month Average Volume: 209,638
Volume % Change: 487%

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From a technical perspective, WGL trended modestly higher here right above some near-term support at $44.50 with heavy upside volume. This stock has been uptrending strong for the last month and change, with shares moving higher from its low of $40.76 to its intraday high of $45.78. During that move, shares of WGL have been consistently making higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of WGL within range of triggering a near-term breakout trade. That trade will hit if WGL manages to take out $45.78 to its 52-week high at $46.22 with high volume.

Traders should now look for long-biased trades in WGL as long as it's trending above some near-term support levels at $45 or $44.50 and then once it sustains a move or close above those breakout levels with volume that hits near or above 209,638 shares. If that breakout hits soon, then WGL will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $50 to $55.

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