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.
Abiomed (ABMD) provides medical devices in circulatory support and continuum of care in heart recovery to acute heart failure patients. This stock closed up 3.9% at $26.76 in Wednesday's trading session.
Wednesday's Volume: 1.05 million
Three-Month Average Volume: 417,390
Volume % Change: 157%
From a technical perspective ABMD spiked higher here right above some near-term support at $25.26 with above-average volume. This stock pulled back over the last few weeks from its high of $30.75 to its low of $25.26. That low corresponded with some previous support from February at $25.32. Market players should now look for a continuation move higher in the short-term if ABMD manages to take out Wednesday's high of $27.10 to its 50-day moving average of $27.90 with high volume.
Traders should now look for long-biased trades in ABMD as long as it's trending above some key near-term support levels at $25.26 or above its 200-day at $24.62 and then once it sustains a move or close above $27.10 to $27.90 with volume that this near or above 417,390 shares. If that move materializes soon, then ABMD will set up to re-test or possibly take out its next major overhead resistance levels at $29 to $30. Any high-volume move above those levels will then give ABMD a chance to tag or take out its 52-week high at $30.77.