WINDERMERE, Fla. (Stockpickr) -- Professional traders that run mutual funds and hedge funds don't just look at a stock's price moves; they also track big changes in volume activity. Many times when above average volume moves into 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."
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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. Let's take a look at a several stocks rising on unusual volume today. They are all recording volume in midday trading that is already at least 50% above their average trading volume for a full day.
Blue Coat Systems
Blue Coat Systems designs, develops and sells proxy and other appliances, and related software and services that secure the delivery of business applications, Web content and other information to distributed users over a wide area network, or across an enterprise's gateway to the public Internet The stock is trading up 8% at $18.30 in recent trading.
Today's Volume: 3,393,000
Average Volume: 757,408
Volume % Change: 1367%
This stock is ripping higher today on high-volume after the company reported a second-quarter profit of 20 cents per share, topping Wall Street estimates of 13 cents per share. Revenue totaled $114 million, which was about $9 million better than expected.
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From a technical standpoint, this stock has started to break out off the bullish earnings news now that the shares have started to move above some past overhead resistance at $17.23 to $18.36.
Market players should watch for the stock to close above those levels to signal that this stock wants to trend higher. If we see a close over $18.36, then look for this stock to make a run at its 200-day moving average of $21.44 in the near future. MTS Systems
MTS Systems is a global supplier of test systems and industrial position sensors. The stock is trading up 13% at $40.52 in recent trading.
Today's Volume: 123,000
Average Volume: 68,594
Volume % Change: 363%
This stock is ripping today after the company reported record quarterly revenue that was up 24% to $132 million, and record EPS growth of 74% at 94 cents per share.
From a technical standpoint, this stock has triggered a big breakout today once shares cleared some near-term overhead resistance at $39.31 and at the 200-day moving average of $39.26. Since clearing those levels, the stock has now pulled back from its daily high of $42.30.
Traders should now watch for the stock to close above the breakout level of $39.31. If we get that close, then look for this stock to make another attempt to re-test $42 to possibly $44.50 in the near-term.
As of the most recently reported period, MTS was a holding in Mairs & Power's portfolio. Mentor Graphics
Mentor Graphics is a supplier of electronic design automation systems-advanced computer software and emulation hardware systems used to automate the design, analysis, and testing of electronic hardware and embedded systems software in electronic systems and components. The stock is trading up 7% at $12.28 in recent trading.
Today's Volume: 1,690,000
Average Volume: 1,146,380
Volume % Change: 283%
This stock is exploding to the upside today after the company beat its third quarter forecast, and said they will remain on track for $1 billion in sales. Mentor posted earnings of $24.1 million, or 22 cents per share, versus earnings of $15.2 million, or 14 cents per share a year ago.
From a technical standpoint, this stock has started to break out above some past overhead resistance at $12 to $12.08 on high-volume.
Market players should now look to buy the next big breakout that will trigger once this stock moves above its 200-day moving average of $12.54 and then above some more overhead resistance at $13.08. A sustained high-volume move and close above those levels sets this stock up to trade back towards $14 to $16.50 a share.
I also featured Mentor in "5 Earnings Stocks Poised to Pop." Marvell Technology
Marvell Technology is a fabless semiconductor provider of application-specific standard products. This stock is trading up 7% at $14.69 in recent trading.
Today's Volume: 18,500,000
Average Volume: 14,006,200
Volume % Change: 189%
This stock is spiking nicely to the upside today despite the fact that the company reported a 1% drop in third quarter net revenues at $950 million, versus the $959 million from the same period last year. Gross margins dropped to 56.6% from 59.3%.
From a technical standpoint, this stock has started to move above its 50-day moving average of $14.55 today on high volume.
Traders should look to play the next major breakout that will trigger once this stock takes out its 200-day moving average at $15.03 and then above some near-term overhead resistance at $15.17. A high-volume move above those levels should set this stock up to re-test some more overhead resistance at $16 to $17.
Marvell, which also shows up in the Lee Ainslie's Maverick Capital portfolio, is one of 3 New Investment ideas From Greenlight's Einhorn. Aruba Networks
Aruba Networks connects local and remote users to corporate information technology resources via distributed enterprise networks. This stock is trading up 2.3% at $22.30 in recent trading
Today's Volume: 3,674,000
Average Volume: 3,898,980
Volume % Change: 134%
This stock is trending up today after the company issued second quarter 2012 revenue guidance above Wall Street estimates. Aruba Networks said that second quarter 2012 revenue is expected to be in the range of $124 million to $126 million versus analysts' estimates of $123 million.
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From a technical standpoint, this stock started the day off strong trading back above its 50-day moving average of $22.64. However, at last check the stock has dropped back below that key technical level and is trading well off the daily high of $24.28.
Market players should watch this stock to see if it can regain its momentum and challenge a big breakout in the near-term. That breakout will hit once ARUN takes out $25 to $26.40 (its 200-day) on high-volume. Any close back below the 50-day should signal that this stock isn't going to challenge that breakout anytime soon. Stericycle
Stericycle is engaged in the business of managing regulated waste and providing an array of related services. The company operates in the U.S., Argentina, Brazil, Canada, Chile, Ireland, Japan, Mexico, Portugal, Romania, and the U.K. The stock is trading up 0.20% at $77.30 in recent trading
Today's Volume: 420,435
Average Volume: 526,215
Volume % Change: 76%
From a technical standpoint, this stock is starting to see some decent upside flow into the name as shares approach some previous support levels near $76.23 to $76.32. If the stock can manage to hold above those levels, then this high-volume buying could be signaling that the stock has formed a near-term bottom and buyers are stepping up to own shares here. It could also be signaling that the stock is preparing for a large rebound in price soon.
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CME Group offers a range of products, including those based on interest rates, equities, foreign exchange, commodities, energy and metals. CME Group also offers clearing services for cleared over-the-counter derivatives, including credit default swaps and interest rate swaps. The stock is trading up 3.5% at $246.35 in recent trading
Today's Volume: 682,000
Average Volume: 675,682
Volume % Change: 101% From a technical standpoint, this is starting to see some decent upside volume flow into the stock as shares came close to hitting some previous support zones at $235.20 to $235.23. The stock hit as low as $236.98 before the stock quickly rebounded and started to spike to the upside.
As long as CME doesn't violate those previous support zones near $235.20 to $235.23, and the upside volume continues to track in strong, then this stock could easily be putting in a tradable bottom here.
-- Written by Roberto Pedone in Winderemere, Fla.