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.
Vince Holding (VNCE), a diversified apparel company, designs, manufactures and markets various fashion products for retailers. This stock closed up 8.1% to $25.69 in Friday's trading session.
Friday's Volume: 1.20 million
Three-Month Average Volume: 276,061
Volume % Change: 186%
From a technical perspective, VNCE exploded higher here right above some near-term support at $23.25 with strong upside volume. This move also pushed shares of VNCE back above its 50-day moving average of $25.32, which is bullish technical price action. Shares of VNCE are now starting to trend within range of triggering a major breakout trade. That trade will hit if VNCE manages to take out Friday's high of $25.70 to some more near-term overhead resistance levels at $27.50 to $27.88 with high volume.
Traders should now look for long-biased trades in VNCE as long as it's trending above Friday's low of $23.85 and then once it sustains a move or close above those breakout levels with volume that hits near or above 276,061 shares. If that breakout hits soon, then VNCE will set up to re-test or possibly take out its next major overhead resistance levels at $30.77 to its all-time high at $32.76.