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.
MacroGenics
MacroGenics (MGNX), a clinical-stage biopharmaceutical company, focuses on discovering and developing monoclonal antibody-based therapeutics for the treatment of cancer and autoimmune diseases. This stock closed up 1.2% to $19.44 in Wednesday's trading session.
Wednesday's Volume: 524,000
Three-Month Average Volume: 256,464
Volume % Change: 115%
From a technical perspective, MGNX trended modestly higher here with strong upside volume flows. This stock recently formed a double bottom chart pattern at $17.96 to $18.03. Following that bottom, shares of MGNX have now started to uptick higher and it's quickly moving within range of triggering a major breakout trade. That trade will hit if MGNX manages to take out Wednesday's intraday high of $19.83 and then once it clears more key overhead resistance levels at $20.96 to $20.99 with high volume.
Traders should now look for long-biased trades in MGNX as long as it's trending above Wednesday's low of $18.84 or above those double bottom support levels and then once it sustains a move or close above those breakout levels with volume that hits near or above 256,464 shares. If that breakout materializes soon, then MGNX will set up to re-test or possibly take out its next major overhead resistance levels at its 50-day moving average of $23.37 to $24.50.
Fair Isaac
Fair Isaac (FICO) provides various analytical solutions, credit scoring and credit account management products and services to banks, credit reporting agencies, credit card processing agencies, insurers, retailers and health care organizations worldwide. This stock closed up 2% at $59.01 in Wednesday's trading session.
Wednesday's Volume: 324,000
Three-Month Average Volume: 189,113
Volume % Change: 125%
From a technical perspective, FICO spiked notably higher here and broke out above some near-term overhead resistance at $58.69 with above-average volume. This stock has been uptrending for the last few weeks, with shares moving higher from its low $53.52 to its intraday high today of $59.26. During that uptrend, shares of FICO have been consistently making higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of FICO within range of triggering another big breakout trade. That trade will hit if FICO manages to take out some key near-term overhead resistance at $59.28 with high volume.
Traders should now look for long-biased trades in FICO as long as it's trending above Wednesday's low of $57.95 or above more support near $56 and then once it sustains a move or close above $59.28 with volume that this near or above 189,113 shares. If that breakout hits soon, then FIO will set up to re-test or possibly take out its next major overhead resistance levels at its 52-week high of $63.48.
WhiteWave Foods
WhiteWave Foods (WWAV), a consumer packaged food and beverage company, manufactures, markets, distributes and sells branded plant-based foods and beverages, coffee creamers and beverages, dairy and organic greens and produce products in North America and Europe. This stock closed up 2.3% at $31.01 in Wednesday's trading session.
Wednesday's Volume: 3.31 million
Three-Month Average Volume: 1.47 million
Volume % Change: 104%
From a technical perspective, WWAV jumped higher here right off some near-term support at $30 with above-average volume. This spike higher on Wednesday briefly pushed shares of WWAV into breakout territory, after the stock flirted with some near-term overhead resistance at $31.48. Shares of WWAV tagged an intraday high of $31.59, before closing just below that level at $31.01. Market players should now look for a continuation move to the upside in the short-term if WWAV manages to take out Wednesday's high and its new all-time high of $31.59 with high volume.
Traders should now look for long-biased trades in WWAV as long as it's trending above some key near-term support levels at $30 or at $29.55 and then once it sustains a move or close above Wednesday's high of $31.59 with volume that hits near or above 1.47 million shares. If that move kicks off soon, then WWAV will set up to enter new all-time-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $35 to $40.
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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