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.
F5 Networks
F5 Networks (FFIV) develops, markets and sells application delivery networking products that optimize the security, performance and availability of network applications, servers, and storage systems. This stock closed up 2.3% at $104.91 in Friday's trading session.
Friday's Volume: 4.51 million
Three-Month Average Volume: 1.92 million
Volume % Change: 162%
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From a technical perspective, FFIV spiked notably higher here with above-average volume. This stock has been uptrending strong for the last two months and change, with shares moving higher from its low of $78.14 to its recent high of $109. During that uptrend, shares of FFIV have been making mostly higher lows and higher highs, which is bullish technical price action. Shares of FFIV are now starting to trend within range of triggering a near-term breakout trade. That trade will hit if FFIV manages to take out Friday's high of $106.12 to its 52-week high at $109 with high volume.
Traders should now look for long-biased trades in FFIV as long as it's trending above Friday's low of $101 and then once it sustains a move or close above those breakout levels with volume that's near or above 1.92 million shares. If that breakout hits soon, then FFIV will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $115 to $120.
Jones Energy
Jones Energy (JONE) focuses on the acquisition, development and production of oil and natural gas properties in the U.S. This stock closed up 0.13% at $15.57 in Friday's trading session.
Friday's Volume: 266,000
Three-Month Average Volume: 135,202
Volume % Change: 125%
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From a technical perspective, JONE trended modestly higher here right above some near-term support at $15 with above-average volume. This move is quickly pushing shares of JONE within range of triggering a near-term breakout trade. That trade will hit if JONE manages to take out Friday's high of $15.70 to some more near-term overhead resistance at $15.75 to $16 with high volume.
Traders should now look for long-biased trades in JONE as long as it's trending above support at $15 or above its 50-day at $14.61 and then once it sustains a move or close above those breakout levels with volume that's near or above 135,202 shares. If that breakout triggers soon, then JONE will set up to re-test or possibly take out its next major overhead resistance levels at $17.07 to its all-time high at $18.14.
Cloud Peak Energy
Cloud Peak Energy (CLD), through its subsidiaries, engages in the coal mining operations in the Powder River Basin and the U.S. This stock closed up 1.8% at $18.05 in Friday's trading session.
Friday's Volume: 1.35 million
Three-Month Average Volume: 731,705
Volume % Change: 175%
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From a technical perspective, CLD spiked notably higher here right above its 200-day moving average of $16.92 and above its 50-day moving average of $17.18 with heavy upside volume. This move is quickly pushing shares of CLD within range of triggering a big breakout trade. That trade will hit if CLD manages to take out Friday's high of $18.07 to some more near-term overhead resistance at $18.87 with high volume.
Traders should now look for long-biased trades in CLD as long as it's trending above its 200-day at $16.92 or above more near-term support at $16.50 and then once it sustains a move or close above those breakout levels with volume that's near or above 731,705 shares. If that breakout triggers soon, then CLD will set up to re-test or possibly take out its next major overhead resistance levels at $20 to its 52-week high at $20.30. Any high-volume move above those levels will then give CLD a chance to tag $22 to $23.
Fortinet
Fortinet (FTNT) provides network security solutions worldwide. This stock closed up 1.5% at $21.68 in Friday's trading session.
Friday's Volume: 8.05 million
Three-Month Average Volume: 2.64 million
Volume % Change: 375%
From a technical perspective, FTNT spiked notably higher here with heavy upside volume. This stock has been uptrending strong for the last two months, with shares moving higher from its low of $16.29 to its intraday high of $22.26. During that uptrend, shares of FTNT have been consistently making higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of FTNT within range of triggering a near-term breakout trade. That trade will hit if FTNT manages to take out Friday's high of $22.26 to some more near-term overhead resistance at $22.45 with high volume.
Traders should now look for long-biased trades in FTNT as long as it's trending above some near-term support levels at $20.90 or above $20 and then once it sustains a move or close above those breakout levels with volume that's near or above 2.64 million shares. If that breakout triggers soon, then FTNT will set up to re-test or possibly take out its next major overhead resistance levels at its 52-week high of $25.35 to $28.
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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