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.
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.
With that in mind, let's take a look at several stocks rising on unusual volume recently.
Qihoo 360 Technology (QIHU) provides Internet and mobile security products and services in the People's Republic of China. This stock closed up 3.7% to $99.15 in Friday's trading session.
Friday's Volume: 5.66 million
Three-Month Average Volume: 2.73 million
Volume % Change: 123%
From a technical perspective, QIHU jumped higher here right above some near-term support at $95 with above-average volume. This spike higher on Friday briefly pushed shares of QIHU into breakout territory, since this stock flirted with some near-term overhead resistance at $99.57. Shares of QIHU tagged an intraday high of $101.60, before closing just below that level at $99.15. Market players should now look for a continuation move to the upside in the near-term if QIHU manages to take out Friday's intraday high of $101.60 with strong volume.
Traders should now look for long-biased trades in QIHU as long as it's trending above Friday's intraday low of $96.04 and then once it sustains a move or close above $101.60 with volume that hits near or above 2.73 million shares. If that move gets underway soon, the QIHU will set up to re-test or possibly take out its next major overhead resistance levels at $105.49 to around $110, or even $115.