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 today.
Ambarella
Ambarella (AMBA) is a developer of semiconductor processing solutions for video that enable high-definition video capture, sharing and display. This stock closed up 8.6% at $16.66 in Friday's trading session.
Friday's Volume: 5.17 million
Three-Month Average Volume: 1.11 million
Volume % Change: 423%
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From a technical perspective, AMBA gapped sharply higher here back above its 50-day moving average of $16.62 with heavy upside volume. This move briefly pushed shares of AMBA into breakout territory, since the stock took out some near-term overhead resistance at $17.42. Shares of AMBA closed below that breakout level at $16.66 with volume that was well above its three-month action of 1.11 million shares.
Traders should now look for long-biased trades in AMBA as long as it's trending above its 50-day at $16.66 or above Friday's low of $16.25 and then once it sustains a move or close above Friday's high of $17.69 with volume that's near or above 1.11 million shares. If that breakout hits soon, then AMBA will set up to re-test or possibly take out its 52-week high at $19.44.
Immersion
Immersion (IMMR) develops, manufactures, licenses and supports a range of hardware and software technologies and products that enhance digital devices with touch interaction. This stock closed up 2.7% at $13.76 in Friday's trading session.
Friday's Volume: 407,000
Three-Month Average Volume: 268,520
Volume % Change: 80%
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From a technical perspective, IMMR bounced notably higher here back above its 50-day moving average at $13.76 with above-average volume. This move is quickly pushing shares of IMMR within range of triggering a near-term breakout trade. That trade will hit if IMMR manages to take out some near-term overhead resistance at $14.42 with high volume.
Traders should now look for long-biased trades in IMMR as long as it's trending above some key near-term support at $13 and then once it sustains a move or close above $14.42 with volume that's near or above 268,520 shares. If that breakout hits soon, then IMMR will set up to re-test or possibly take out its 52-week high at $16.73.
Ruckus Wireless
Ruckus Wireless (RKUS) provides carrier-class Wi-Fi solutions to service providers and enterprises to solve network capacity and coverage challenges. This stock closed up 1.7% at $15.30 in Friday's trading session.
Friday's Volume: 2.75 million
Three-Month Average Volume: 1.45 million
Volume % Change: 135%
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From a technical perspective, RKUS rose modestly higher here right above its 50-day moving average at $13.86 with above-average volume. This move pushed shares of RKUS into breakout territory, since the stock took out some past overhead resistance at $15.20. This breakout has now putting a massive gap into play for RKUS if this stock can see continued follow through in the near future.
Traders should now look for long-biased trades in RKUS as long as it's trending above its 50-day at $15.30 and then once it sustains a move or close above Friday's high of $15.60 with volume that's near or above 1.45 million shares. If we get that move soon, then RKUS will set up to re-fill its previous gap down zone from May that started near $19.
Rally Software Development
Rally Software Development (RALY) provides Agile software development tools and educational and support services to help companies adopt Agile and Lean software development practice. This stock closed up 4.6% at $26.80 in Friday's trading session.
Friday's Volume: 541,000
Three-Month Average Volume: 171,183
Volume % Change: 297%
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From a technical perspective, RALY ripped higher here back above its 50-day moving average at $26.47 with strong upside volume. This move also pushed shares of RALY into breakout territory, since the stock took out some near-term overhead resistance at $26.42. Shares of RALY are now quickly moving within range of triggering an even bigger breakout trade. That trade will hit if RALY manages to take out some near-term overhead resistance at $27.90 with high volume.
Traders should now look for long-biased trades in RALY as long as it's trending above its 50-day at $26.47 or above Friday's low of $26, and then once it sustains a move or close above $27.90 with volume that's near or above 171,183 shares. If we get that move soon, then RALY will set up re-test or possibly take out its all-time high at $30.25. Any high-volume move above $30.25 will then give RALY a chance to tag $32 to $35.
ServiceSource International
ServiceSource International (SREV) helps hardware, software, health care, and life sciences companies derive from their customers more revenue from maintenance, support and subscription agreements. This stock closed up 1% at $12.97 in Friday's trading session.
Friday's Volume: 1.47 million
Three-Month Average Volume: 979,000
Volume % Change: 125%
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From a technical perspective, SREV jumped modestly higher here right above some near-term support at $12.03 with above-average volume. This stock has been uptrending strong for the last month and change, with shares moving higher from its low of $10.59 to its recent high of $13.27. During that move, shares of SREV have been consistently making higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of SREV within range of triggering a major breakout trade. That trade will hit SREV manages to clear Friday's high of $13 and then once it takes out its 52-week high at $13.27 with high volume.
Traders should now look for long-biased trades in SREV as long as it's trending above Friday's low of $12.42 or above support at $12.03 and then once it sustains a move or close above those breakout levels with volume that's near or above 979,000 shares. If that breakout triggers soon, then SREV will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that move are $16 to $18.
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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