3 Stocks Breaking Out on Big Volume

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.

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Major moves in volume can signal unusual activity, such as insider buying or selling -- or buying or selling by "superinvestors."

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.

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With that in mind, let's take a look at several stocks rising on unusual volume recently.

Dick's Sporting Goods

Dick's Sporting Goods (DKS) operates as a sports and fitness retailer primarily in the eastern U.S. This stock closed up 3% to $44.45 in Friday's trading session.

Friday's Volume: 4.66 million
Three-Month Average Volume: 1.88 million
Volume % Change: 152%

From a technical perspective, DKS gapped up notably higher here right above its recent 52-week low of $42.33 with strong upside volume. This stock recently gapped down sharply from $53 to below $44 with heavy downside volume. Following that move, shares of DKS went on to print a new 52-week low of $42.33. Shares of DKS are now starting to rebound off that 52-week low and it's quickly moving within range of triggering a big breakout trade. That trade will hit if DKS manages to take out Friday's intraday high of $44.99 to its gap-down-day high of $46.17 with high volume.

Traders should now look for long-biased trades in DKS as long as it's trending above Friday's intraday low of $43.82 or above its 52-week low of $42.33 and then once it sustains a move or close above those breakout levels with volume that hits near or above 1.88 million shares. If that breakout triggers soon, the DKS will set up to re-fill some of its previous gap-down-day zone that started around $53.

United States Cellular

United States Cellular (USM) operates as a wireless telecommunications service provider in the U.S. This stock closed up 2.7% to $42.95 in Friday's trading session.

Friday's Volume: 167,000
Three-Month Average Volume: 112,475
Volume % Change: 203%

From a technical perspective, USM jumped higher here and cleared its 200-day moving average of $42.71 with above-average volume. This move higher on Friday is starting to push shares of USM within range of triggering a big breakout trade. That trade will hit if USM manages to take out some key near-term overhead resistance levels at $43.50 to $44.86 with high volume.

Traders should now look for long-biased trades in USM as long as it's trending above Friday's low of $41.81 or above its 50-day at $41.20 and then once it sustains a move or close above those breakout levels with volume that hits near or above 112,475 shares. If that breakout gets underway soon, then USM will set up to re-test or possibly take out its 52-week high at $48.98.

Grupo Financiero Galicia

Grupo Financiero Galicia (GGAL) operates as a financial services holding company in Argentina. This stock closed up 4.1% at $13.58 in Friday's trading session.

Friday's Volume: 871,000
Three-Month Average Volume: 443,038
Volume % Change: 155%

From a technical perspective, GGAL ripped higher here right off its 50-day moving average of $12.89 with above-average volume. This spike higher on Friday pushed shares of GGAL into breakout territory, since the stock took out some near-term overhead resistance at $12.94. Shares of GGAL are now starting to move within range of triggering an even bigger breakout trade. That trade will hit if GGAL manages to take out Friday's intraday high of $13.60 and then once it clears more key overhead resistance levels at $14.09 to its 52-week high at $14.35 with high volume.

Traders should now look for long-biased trades in GGAL as long as it's trending above its 50-day moving average at $12.89 or above $12.50 and then once it sustains a move or close above those breakout levels with volume that hits near or above 443,038 shares. If that breakout starts soon, then GGAL will set up to enter new 52-week-high territory above $14.35, which is bullish technical price action. Some possible upside targets off that breakout are $17 to $20.

To see more stocks rising on unusual volume, check out the Stocks Rising on Unusual Volume portfolio on Stockpickr.

-- Written by Roberto Pedone in Delafield, Wis.

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At the time of publication, author had no positions in stocks mentioned. Roberto Pedone, based out of Delafield, Wis., is an independent trader who focuses on technical analysis for small- and large-cap stocks, options, futures, commodities and currencies. Roberto studied international business at the Milwaukee School of Engineering, and he spent a year overseas studying business in Lubeck, Germany. His work has appeared on financial outlets including CNBC.com and Forbes.com. You can follow Pedone on Twitter at www.twitter.com/zerosum24 or @zerosum24.

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