4 Unusual-Volume Stocks to Trade for Breakouts

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.

Jack in the Box

Jack in the Box (JACK), a restaurant company, operates and franchises Jack in the Box quick-service restaurants and Qdoba Mexican Grill fast-casual restaurants in the U.S. This stock closed up 1.5% to $58.48 in Monday's trading session.

Monday's Volume: 673,000
Three-Month Average Volume: 394,319
Volume % Change: 82%

From a technical perspective, JACK jumped modestly higher here right above some near-term support at $57 with above-average volume. This stock has been uptrending over the last few weeks, with shares moving higher from its low of $55.15 to its recent high of $59.35. During that move, shares of JACK have been consistently making higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of JACK within range of triggering a near-term breakout trade. That trade will hit if JACK manages to take out some key near-term overhead resistance levels at $59 to $59.35 with high volume.

Traders should now look for long-biased trades in JACK as long as it's trending above $57 or $56 and then once it sustains a move or close above those breakout levels with volume that hits near or above 394,319 shares. If that breakout kicks off soon, then JACK will set up to re-test or possibly take out its next major overhead resistance levels at $61.39 to its 52-week high at $62.90.

RigNet

RigNet (RNET), provides network infrastructure services for the remote communications needs of the oil and gas industry. This stock closed up 3% at $55.63 in Monday's trading session.

Monday's Volume: 295,000
Three-Month Average Volume: 104,575
Volume % Change: 147%

From a technical perspective, RNET jumped higher here right above its 50-day moving average of $52.71 with above-average volume. This spike to the upside on Monday is starting to push shares of RNET within range of triggering a near-term breakout trade. That trade will hit if RNET manages to take out some near-term overhead resistance levels at $57.14 to $57.22 with high volume.

Traders should now look for long-biased trades in RNET as long as it's trending above Monday's intraday low of $53.77 or above its 50-day at $52.71 and then once it sustains a move or close above those breakout levels with volume that this near or above 104,575 shares. If that breakout gets started soon, then RNET will set up to re-test or possibly take out its next major overhead resistance level at its 52-week high of $59.06. Any high-volume move above that level will then give RNET a chance to trend north of $60.

CH Robinson Worldwide

CH Robinson Worldwide (CHRW), a third party logistics company, provides freight transportation services and logistics solutions to companies in various industries worldwide. This stock closed up 1.1% at $68.46 in Monday's trading session.

Monday's Volume: 6.26 million
Three-Month Average Volume: 1.42 million
Volume % Change: 273%

From a technical perspective, CHRW trended modestly higher here with heavy upside volume flows. This stock has been uptrending strong for the last four months, with shares moving higher from its low of $49.92 to its recent high of $69.50. During that move, shares of CHRW have been consistently making higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of CHRW within range of triggering a near-term breakout trade. That trade will hit if CHRW manages to take out its 52-week high at $69.50 with high volume.

Traders should now look for long-biased trades in CHRW as long as it's trending above some key near-term support levels at $67.14 to around $66 and then once it sustains a move or close above $69.50 with volume that's near or above 1.42 million shares. If that breakout triggers soon, then CHRW will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $75 to $80.

Silicon Motion Technology Group

Silicon Motion Technology Group (SIMO), a fabless semiconductor company, designs, develops and markets semiconductor solutions for mobile storage and mobile communications markets. This stock closed up 3.8% at $24.43 in Monday's trading session.

Monday's Volume: 659,000
Three-Month Average Volume: 439,789
Volume % Change: 80%

From a technical perspective, SIMO jumped higher here right above some near-term support at $22.75 with above-average volume. This notable spike to the upside on Monday is quickly pushing shares of SIMO within range of triggering a near-term breakout trade. That trade will hit if SIMO manages to take out Monday's intraday high of $24.50 to its 52-week high at $24.60 with high volume.

Traders should now look for long-biased trades in SIMO as long as it's trending above Monday's intraday low of $23.51 or above more near-term support at $22.75 and then once it sustains a move or close above those breakout levels with volume that's near or above 439,789 shares. If that breakout materializes soon, then SIMO will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $29 to $30.

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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