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.
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.
With that in mind, let's take a look at several stocks rising on unusual volume recently.
Canadian Solar (CSIQ), together with its subsidiaries, engages in the design, development, manufacture and sale of solar power products worldwide. This stock closed up 6.4% at $42.66 in Wednesday's trading session.
Wednesday's Volume: 7.57 million
Three-Month Average Volume: 3.95 million
Volume % Change: 145%
From a technical perspective, CSIQ ripped sharply higher here and broke out above some near-term overhead resistance levels $40.48 to $40.66 and then $41.80 with heavy upside volume. This move also briefly pushed shares of CSIQ into new 52-week-high territory, since the stock flirted with some more near-term overhead resistance at $43.60. Market players should now look for a continuation move higher in the short-term if CSIQ manages to take out Wednesday's high of $44.01 with high volume.
Traders should now look for long-biased trades in CSIQ as long as it's trending above Wednesday's low of $39.75 and then once it sustains a move or close above its new 52-week high at $44.01 with volume that's near or above 3.95 million shares. If we get that move soon, then CSIQ will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that move are $48 to $50.