4 Big-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.

Dynavax Technologies

DVAX ChartDVAX data by YCharts

Dynavax Technologies  (DVAX), a clinical-stage biopharmaceutical company, discovers and develops novel vaccines and therapeutics in the U.S. This stock traded up 8.2% to $25.51 in Monday's trading session.

Monday's Volume: 1.67 million
Three-Month Average Volume: 379,113
Volume % Change: 352%

From a technical perspective, Dynavax Technologies ripped to the upside on Monday and broke out above some key overhead resistance levels at $23.87 to $24.60 with strong upside volume flows. This high-volume breakout is now quickly pushing shares of Dynavax Technologies within range of triggering another major breakout trade, which will trigger if this stock manages to clear Monday's intraday high of $25.53 and then once it takes out its 52-week high of $26.89 with high volume.

Traders should now look for long-biased trades in Dynavax Technologies as long as it's trending above those recent breakout levels at $24.60 or right around $24 to $23 and then once it sustains a move or close above $25.53 to $26.89 with volume that hits near or above 379,113 shares. If that breakout hits soon, then this stock will set up to enter new 52-week-high territory above $26.89, which is bullish technical price action. Some possible upside targets off that move are $30 to $35 a share.

eHealth

EHTH ChartEHTH data by YCharts

eHealth  (EHTH) provides online health insurance services in the U.S. and China. This stock traded up 13.2% to $13.72 in Monday's trading session.

Monday's Volume: 453,000
Three-Month Average Volume: 215,835
Volume % Change: 109%

From a technical perspective, eHealth exploded to the upside on Monday right off its 50-day moving average of $12.54 with strong upside volume flows. This strong spike higher on Monday also pushed shares of eHealth into breakout territory, since the stock cleared some key near-term overhead resistance levels at $13.09 to $13.28. Shares of eHealth are now starting to trend within range of triggering a much bigger breakout trade. That trade will hit if this stock manages to take out some key overhead resistance levels at $14 to $14.90 with high volume.

Traders should now look for long-biased trades in eHealth as long as it's trending above $13 or above its 50-day at $12.54 and then once it sustains a move or close above those breakout levels with volume that hits near or above 215,835 shares. If that breakout begins soon, then this stock will set up to re-fill some of its previous gap-down-day zone from January that started near $20 a share.

Aratana Therapeutics

PETX ChartPETX data by YCharts

Aratana Therapeutics  (PETX), development-stage biopharmaceutical company, focuses on the licensing, development, and commercialization of biopharmaceutical products for the companion animals worldwide. This stock traded up 3.6% to $14.69 in Monday's trading session.

Monday's Volume: 618,000
Three-Month Average Volume: 254,508
Volume % Change: 129%

From a technical perspective, Aratana Therapeutics spiked notably higher on Monday right off its 50-day moving average of $13.91 with strong upside volume flows. This stock has been uptrending for the last week or so, with shares moving higher from its low of $11.69 to its recent high of $16 a share. That uptrend started after shares of Aratana Therapeutics broke its previous lows at around $12.77 to $12.52.

Aratana is now starting to trend within range of triggering a major breakout trade above some key overhead resistance levels. That trade will hit if this stock manages to take out some near-term overhead resistance levels $15 to $16 and then above more resistances levels at $16.92 to $17 with high volume.

Traders should look for long-biased trades in Aratana Therapeutics as long as it's trending above its 50-day at $13.91 or above more near-term support at $13 and then once it sustains a move or close above those breakout levels with volume that hits near or above 254,508 shares. If that breakout kicks off soon, then this stock will set up to re-test or possibly take out its next major overhead resistance levels at $19 to $20 a share.



Intrexon

XON ChartXON data by YCharts

Intrexon  (XON), a biotechnology company, operates in the synthetic biology field in the U.S. This stock traded up 3.4% to $47.54 in Monday's trading session.

Monday's Volume: 3.18 million
Three-Month Average Volume: 1.15 million
Volume % Change: 155%

From a technical perspective Intrexon ripped sharply higher on Monday right above some near-term support at $45.38 with strong upside volume flows. This stock has been downtrending a bit in the short-term, with shares moving lower from its high of $51.44 to that recent low of $45.38 a share. During that downtrend, it has been making mostly lower highs and lower lows, which is bearish technical price action.

That said, shares of Intrexon might be getting ready to reverse that recent downtrend and possibly trigger a near-term breakout trade. That trade will hit if Intrexon manages to take out some near-term overhead resistance levels at $50 to its all-time high of $51.44 with high volume.

Traders should now look for long-biased trades in Intrexon as long as it's trending above some key near-term support levels at $45.38 or above its 50-day at $43.01 and then once it sustains a move or close above those breakout levels with volume that registers near or above 1.15 million shares. If that breakout develops soon, then this stock will set up to enter new all-time-high territory above $51.44, which is bullish technical price action. Some possible upside targets off that move are $55 to $60 a share.

This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.

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