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.
Maxwell Technologies (MXWL), together with its subsidiaries, develops, manufactures and markets energy storage and power delivery products worldwide. This stock closed up 6.5% to $16.64 in Wednesday's trading session.
Wednesday's Volume: 1.62 million
Three-Month Average Volume: 1.04 million
Volume % Change: 115%
From a technical perspective, MXWL ripped higher here right above some near-term support at $15.05 with above-average volume. This move pushed shares of MXWL into breakout and new 52-week-high territory, since this stock cleared or flirted with some near-term overhead resistance levels at $16.33 to $17.02. Market players should now look for a continuation move to the upside in the short-term if MXWL manages to take out its new 52-week high at $17.15 with strong volume.
Traders should now look for long-biased trades in MXWL as long as it's trending above Wednesday's low of $16.16 or above more support at $15.05 and then once it sustains a move or close above $17.15 with volume that hits near or above 1.04 million shares. If we get that move soon, then MXWL will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that move are $20 to $22.