2 Stocks Spiking on Unusual 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 recently.

Align Technology

Align Technology (ALGN) operates as a medical device company primarily in the U.S. and internationally. This stock closed up 2.2% at $54.81 in Friday's trading session.

Friday's Volume: 2.60 million
Three-Month Average Volume: 1.29 million
Volume % Change: 107%

From a technical perspective, ALGN spiked higher here back above its 50-day moving average of $54.34 with above-average volume. This move briefly pushed shares of ALGN into breakout territory, after the stock flirted with some near-term overhead resistance levels at $55.31 to $55.96. Shares of ALGN pulled back off its intraday high of $57.50 to close at $54.81. Market players should now look for a continuation move higher in the short-term if ALGN manages to take out Friday's high of $57.50 with strong volume.

Traders should now look for long-biased trades in ALGN as long as it's trending above $53 or $52 and then once it sustains a move or close above $57.50 with volume that this near or above 1.29 million shares. If that move starts soon, then ALGN will set up to re-test or possibly take out its next major overhead resistance levels at $59.81 to $62.

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