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.
Healthways (HWAY), through its subsidiaries, provides specialized solutions to help people to enhance their physical, emotional and social well-being. This stock closed up 12.9% at $18.16 in Friday's trading session.
Friday's Volume: 2.06 million
Three-Month Average Volume: 449,755
Volume % Change: 398%
From a technical perspective, HWAY skyrocketed higher here and broke out above some near-term overhead resistance levels at $17.43 to $17.74 with heavy upside volume. This breakout moved shares of HWAY above the upper-end of its recent sideways trading chart pattern. Market players should now look for a continuation move higher in the short-term if HWAY manages to take out Friday's intraday high of $18.73 to some more key overhead resistance at $19 with high volume.
Traders should now look for long-biased trades in HWAY as long as it's trending above Friday's low of $16.71 and then once it sustains a move or close above $18.73 to $19 with volume that hits near or above 449,755 shares. If that move starts soon, then HWAY will set up to re-test or possibly take out its 52-week high at $22.20.