5 Stocks Spiking on Unusual Volume

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.

CaesarStone Sdot-Yam

CaesarStone Sdot-Yam ( CSTE) manufactures engineered quartz surfaces. This stock closed up 2.5% at $43.73 in Monday's trading session.

Monday's Volume: 456,000
Three-Month Average Volume: 284,725
Volume % Change: 94%

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From a technical perspective, CSTE spiked higher here right off its 50-day moving average of $42.33 with above-average volume. This bump higher is a continuation pattern of CSTE's recent move out of its downtrend that started in late September at $48.69 to its low of $36.26. That low of $36.26 was the end of CSTE's recent downside volatility. Shares of CSTE now look ready to continue its trend higher and potentially challenge its all-time highs.

Traders should now look for long-biased trades in CSTE as long as it's trending above its 50-day at $42.33 or above $42 and then once it sustains a move or close above Monday's high of $44.74 with volume that's near or above 284,725 shares. If we get that move soon, then CSTE will set up to re-test or possibly take out its all-time high at $48.69. Any high-volume move above that level will then give CSTE a chance to tag $50 to $53.

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