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.

>>5 Stocks Ready for Breakouts

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.

>>5 Toxic Stocks to Sell Now

With that in mind, let's take a look at several stocks rising on unusual volume recently.

Flowers Foods

Flowers Foods (FLO) produces and markets bakery foods in the U.S. This stock closed up 3.4% at $21.37 in Friday's trading session.

Friday's Volume: 4.19 million
Three-Month Average Volume: 1.19 million
Volume % Change: 249%

From a technical perspective, FLO jumped higher here right off its 50-day moving average of $20.65 with above-average volume. This move is starting to push shares of FLO within range of triggering a major breakout trade. That trade will hit if FLO manages to take out its 200-day moving average of $21.76 to some more key overhead resistance levels at $22.10 to just above $22.50 with high volume.

Traders should now look for long-biased trades in FLO as long as it's trending above its 50-day moving average of $20.65 or above more support at $20 and then once it sustains a move or close above those breakout levels with volume that hits near or above 1.19 million shares. If that breakout starts soon, then FLO will set up to re-fill some of its previous gap-down-day zone from last November that started near $25.

If you liked this article you might like

EU Expected to Approve Rockwell Collins Bid for B/E Aerospace

5 Things You Must Know Before the Market Opens Thursday

Here's Who Killed It in October Dealmaking Advice

Rockwell Collins Gambles on B/E at Top of Cycle

Jim Cramer's 'Mad Money' Recap: The Three Faces of the Stock Market