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.
CBS Outdoor Americas
CBS Outdoor Americas (CBSO) leases advertising space on out-of-home advertising structures and sites in the U.S., Canada and Latin America. This stock closed up 3% at $31.41 in Friday's trading session.
Friday's Volume: 2.05 million
Three-Month Average Volume: 1.45 million
Volume % Change: 344%
From a technical perspective, CBSO spiked sharply higher here and broke out above some near-term overhead resistance at $31 with above-average volume. This stock has been uptrending for the last few weeks, with shares moving higher from its low of $28.33 to its intraday high of $32. During that move, shares of CBSO have been consistently making higher lows and higher highs, which is bullish technical price action. Market players should now look for a continuation move higher in the short-term if CBSO manages to take out its all-time high at $32 with strong volume.
Traders should now look for long-biased trades in CBSO as long as it's trending above $31 or above $30 and then once it sustains a move or close above $32 with volume that hits near or above 1.45 million shares. If that move starts soon, then CBSO will set up to enter new all-time-high territory, which is bullish technical price action. Some possible upside targets off that move are $35 to $40.