4 Stocks Breaking Out 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.

Altra Industrial Motion

Altra Industrial Motion ( AIMC) is a designer, producer and marketer of mechanical power transmissions and motion control products serving customers in a group of industries, including energy, material handling, mining, transportation and turf and garden. This stock closed up 2.1% at $31.81 in Monday's trading session.

Monday's Volume: 339,000
Three-Month Average Volume: 127,153
Volume % Change: 127%

From a technical perspective, AIMC trended modestly higher here with above-average volume. This move is quickly pushing shares of AIMC within range of triggering a near-term breakout trade. That trade will hit if AIMC manages to take out Monday's high of $31.97 to its 52-week high of $32.76 with high volume.

Traders should now look for long-biased trades in AIMC as long as it's trending above $30.50 or above $30 and then once it sustains a move or close above those breakout levels with volume that's near or above 127,153 shares. If that breakout hits soon, then AIMC will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $36 to $38.

ITT

ITT ( ITT) is a manufacturer of highly engineered critical components and customized solutions for growing industrial end-markets such as energy infrastructure, electronics, aerospace and transportation. This stock closed up 2.8% at $41.32 in Monday's trading session.

Monday's Volume: 1.49 million
Three-Month Average Volume: 725,508
Volume % Change: 75%

From a technical perspective, ITT trended modestly higher here right off some near-term support at $40 with above-average volume. This stock has been uptrending strong for the last six months, with shares soaring higher from its low of $27.93 to its recent high of $41.79. During that uptrend, shares of ITT have been consistently making higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of ITT within range of triggering a major breakout trade. That trade will hit if ITT manages to take out Monday's high of $41.41 to its 52-week high at $41.79 with high volume.

Traders should now look for long-biased trades in ITT as long as it's trending above some key near-term support levels at $39.73 or above its 50-day at $38.79 and then once it sustains a move or close above those breakout levels with volume that's near or above 725,508 shares. If that breakout hits soon, then ITT will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $47 to $50.

Ternium

Ternium ( TX) is engaged in manufacturing and processing of flat and long steel products for the construction, home appliances, capital goods, container, food, energy and automotive industries. This stock closed up 2% at $27.97 in Monday's trading session.

Monday's Volume: 427,000
Three-Month Average Volume: 208,588
Volume % Change: 112%

From a technical perspective, TX spiked higher here right above its 50-day moving average of $26.70 with above-average volume. This stock has been uptrending strong for the last six months, with shares moving higher from its low of $20.02 to its recent high of $28.40. During that uptrend, shares of TX have been consistently making higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of TX within range of triggering a big breakout trade. That trade will hit if TX manages to take out some near-term overhead resistance levels at $28.29 to its 52-week high at $28.40 with high volume.

Traders should now look for long-biased trades in TX as long as it's trending above Monday's low of $27.47 or above its 50-day at $26.70, and then once it sustains a move or close above those breakout levels with volume that hits near or above 208,588 shares. If that breakout hits soon, then TX will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $34 to $36.

Dealertrack Technologies

Dealertrack Technologies ( TRAK) operates as an online credit application network in U.S. & Canada. This stock closed up 2.2% at $42.97 in Monday's trading session.

Monday's Volume: 341,000
Three-Month Average Volume: 212,898
Volume % Change: 75%

From a technical perspective, TRAK spiked modestly higher here with above-average volume. This stock has been trending sideways for the last month, with shares moving between $39.78 on the downside and $43.65 on the upside. Shares of TRAK are now quickly moving within range of triggering a big breakout trade above the upper-end of its recent sideways trading chart pattern. That breakout will hit if TRAK manages to take out Monday's high of $43.19 to its 52-week high at $43.65 with high volume.

Traders should now look for long-biased trades in TRAK as long as it's trending above Monday's low of $41.88 or above its 50-day at $40.65, and then once it sustains a move or close above those breakout levels with volume that's near or above 212,898 shares. If that breakout hits soon, then TRAK will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $47 to $50.

To see more stocks rising on unusual volume, check out the Stocks Rising on Unusual Volume portfolio on Stockpickr.

-- Written by Roberto Pedone in Delafield, Wis.

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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
CNBC.com and Forbes.com . You can follow Pedone on Twitter at www.twitter.com/zerosum24 or @zerosum24.

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