3 Stocks Spiking on Big 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.

Diamond Foods

Diamond Foods ( DMND) is a food company that deals in processing, marketing and distributing culinary, in-shell, ingredient nuts and snack products. This stock closed up 6.8% to $25.79 in Friday's trading session.

Friday's Volume: 1.36 million
Three-Month Average Volume: 376,761
Volume % Change: 260%

From a technical perspective, DMND soared higher here right off its 50-day moving average of $23.39 with strong upside volume. This move pushed shares of DMND into breakout and new 52-week-high territory, since the stock took out some near-term overhead resistance levels at $25.07 to $25.32. Market players should now look for a continuation move higher in the short-term if DMND manages to clear its new 52-week high at $26.23 with high volume.

Traders should now look for long-biased trades in DMND as long as it's trending above its 50-day at $23.39 and then once it sustains a move or close above $26.23 with volume that hits near or above 376,761 shares. If we get that move soon, then DMND will set up to re-test or possibly take out its next major overhead resistance level at $28.29. Any high-volume move above that level will then give DMND a chance to re-fill some of its previous gap down zone from February of 2012 that started near $35.

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