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.
Sanofi (SNY) researches, develops, manufactures, and markets health care products. This stock closed up 1.1% at $51.82 in Monday's trading session.
Monday's Volume: 3.26 million
Three-Month Average Volume: 1.80 million
Volume % Change: 96%
From a technical perspective, SNY spiked modestly higher here right above its 200-day moving average of $51.06 with above-average volume. This stock recently formed a double top chart pattern at $52.76 to $52.74. Following that top, shares of SNY have pulled back a bit to right around its 200-day moving average. Shares of SNY are now starting to bounce higher again and move within range of triggering a breakout trade above those double top resistance levels.
Traders should now look for long-biased trades in SNY as long as it's trending above its 200-day at $51.06 or above its 50-day at $50.58 and then once it sustains a move or close above $52.74 to $52.76 with volume that's near or above 1.80 million shares. If that breakout starts soon, then SNY will set up to re-test or possibly take out its next major overhead resistance levels at $53.63 to $54.49, or even its 52-week high at $55.94.