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.
Mylan (MYL), a pharmaceutical company, develops, licenses, manufactures, markets and distributes generic, branded generic and specialty pharmaceuticals worldwide. This stock closed up 3.4% to $52.10 in Friday's trading session.
Friday's Volume: 15.89 million
Three-Month Average Volume: 5.96 million
Volume % Change: 140%
From a technical perspective, MYL trended higher here back above its 50-day moving average of $50.83 with above-average volume. This stock has been uptrending strong for the last few weeks, with shares moving higher from its low of $44.74 to its intraday high of $53.57. During that uptrend, shares of MYL have been making mostly higher lows and higher highs, which is bullish technical price action. Market players should now look for a continuation move to the upside in the short-term if MYL manages to take out Friday's intraday high of $53.57 with high volume.
Traders should now look for long-biased trades in MYL as long as it's trending above Fridays low of $49.06 and then once it sustains a move or close above Friday's high of $53.57 with volume that hits near or above 5.96 million shares. If that move gets underway soon, then MYL will set up to re-test or possibly take out its next major overhead resistance levels at $55.30 to its 52-week high at $57.52.