3 Unusual-Volume Stocks Triggering Breakout Trades

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."

Must Read: 5 Rocket Stocks to Buy to Avoid the Selloff




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.

Must Read: 5 Breakout Stocks Under $10 Set to Soar

Iron Mountain

Iron Mountain (IRM), together with its subsidiaries, provides storage and information management services primarily in North America, Europe, Latin America and the Asia Pacific. This stock closed up 6.2% to $33.90 in Monday's trading session.

Monday's Volume: 9.29 million

Three-Month Average Volume: 1.70 million

Volume % Change: 447%

From a technical perspective, IRM ripped sharply here right above its 50-day moving average of $31.09 with monster upside volume flows. This strong spike to the upside on Monday also pushed shares of IRM into breakoutterritory, since the stock took out some near-term overhead resistance levels at $32.44 to $32.84. Market players should now look for a continuation move to the upside in the short-term if IRM manages to take out Monday's intraday high and its new 52-week high of $34.31 with high volume.

Traders should now look for long-biased trades in IRM as long as it's trending above its 50-day moving average at $31.09 and then once it sustains a move or close above those breakout levels with volume that hits near or above 1.70 million shares. If that move starts soon, then IRM will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that move are $40 to $42.

Must Read: 5 Stocks Insiders Love Right Now

Clovis Oncology

Clovis Oncology (CLVS), a biopharmaceutical company, focuses on acquiring, developing and commercializing anti-cancer agents in the U.S., Europe and internationally. This stock closed up 13.1% at $48.08 in Monday's trading session.

Monday's Volume: 2.35 million

Three-Month Average Volume: 713,516

Volume % Change: 229%

From a technical perspective, CLVS gapped sharply higher here back above its 50-day moving average of $42.38 with strong upside volume flows. This large spike to the upside on Monday also pushed shares of CLVS into breakout territory, since the stock took out some near-term overhead resistance at $46.48. Shares of CLVS are now quickly moving within range of triggering another big breakout trade. That trade will hit if CLVS manages to clear Monday's intraday high of $49.30 to some more key overhead resistance at $50.87 with high volume.

Traders should now look for long-biased trades in CLVS as long as it's trending above $46.48 or above $45 and then once it sustains a move or close above those breakout levels with volume that hits near or above 713,516 shares. If that breakout hits soon, then CLVS will set up to re-test or possibly take out its next major overhead resistance levels at its 200-day moving average of $55.41 to $59.09.

Must Read: Sell These 5 Toxic Stocks Before the Next Drop

Conns

Conns (CONN) operates as a specialty retailer of durable consumer goods and related services in Texas, Arizona, Louisiana, Oklahoma and New Mexico, the U.S. This stock closed up 6.4% to $30.70 in Monday's trading session.

Monday's Volume: 4.96 million

Three-Month Average Volume: 1.24 million

Volume % Change: 253%

From a technical perspective, CONN ripped sharply higher here right above some near-term support at $28 with strong upside volume flows. This stock recently gapped down sharply from over $44 to under $32 with heavy downside volume. Following that move, shares of CONN went on to trend lower and print a new 52-week low at $26.60. Shares of CONN have now started to bounce off that 52-week low and it's starting to trend within range of triggering a major breakout trade. That trade will hit if CONN manages to take out some key near-term overhead resistance levels at $31.44 to its gap-down-day high of $33.65 with high volume.

Traders should now look for long-biased trades in CONN as long as it's trending above Monday's intraday low of $28.43 and then once it sustains a move or close above those breakout levels with volume that hits near or above 1.24 million shares. If that breakout triggers soon, then CONN will set up to re-fill some of its previous gap-down-day zone that started just above $44.

Must Read: 10 Stocks George Soros Is Buying

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.

RELATED LINKS:

>>4 M&A Deal Stocks That Could Cut You a Paycheck This Fall

>>4 Big Tech Stocks on Traders' Radars

>>3 Unusual-Volume Biotech Stocks in Breakout Territory

Follow Stockpickr on Twitter and become a fan on Facebook.

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.

Don't panic after Bill Gross exit

Is Bill Gross' future at Janus really that bright? Only time will tell. NEW YORK (CNNMoney) The bond king has left the building. Should investors run for the exits too?

Investors with money at Pimco are understandably queasy after legendary investor Bill Gross shocked the financial world by jumping ship on Friday.

Some are already yanking their cash from the $2 trillion pile that Pimco manages. Others may even follow Gross to Janus Capital (JNS) where he's poised to manage a new bond fund.

But Morningstar is warning investors to avoid overreacting.

"Now is the time to reassess, but not panic. Yes, Bill Gross -- one of the world's greatest living investors -- is leaving. But there's a deep bench behind him," said Scott Burns, global director of manager research at Morningstar.

Not telegraphed: It's clear Gross's departure caught many people off guard -- even the experts.

Morningstar placed all 50 rated Pimco funds under review on Friday to give it time to weigh the news.

"Fund managers leave but it's rare it happens at such a flagship like this. It's always better for investors when it's deliberate, planned and telegraphed," said Burns.

He said it's possible hundreds of billions in Pimco funds may leave the firm with Gross.

Of course, that's nothing new for Pimco, which has been rocked by 16 straight months of client outflows at its flagship Total Return fund. The Total Return fund is up 3.6% this year, but that's trailing its benchmark, according to Morningstar data.

Pimco's outflow problems weren't helped by the surprise departure earlier this year of former CEO Mohamed El-Erian. His exit triggered a wave of negative stories suggesting Gross's erratic behavior was to blame.

It's possible Pimco could benefit from fewer distracti! ons now that Gross is gone.

Deep bench: Morningstar stressed that Pimco has a number of capable fund managers it can rely on to fill Gross' shoes, including deputy chief investment officers Dan Ivascyn and Mark Kiesel.

Ivascyn was named fixed-income fund manager of the year in 2013 by Morningstar and Kiesel won the prestigious award the year before.

"There's a lot of depth at Pimco. It's not like his departure has left the cupboard bare," said Burns.

It's also worth remembering that Gross secured his reputation as a legend in finance after decades of success. The 70-year-old who founded Pimco back in 1971 isn't exactly a rising star anymore.

"One way or another, this was coming to an end," said Burns.

Jump to Janus? Gross's arrival at Janus is already generating serious excitement. The asset manager's shares surged 38% on Friday as Wall Street bets the blockbuster news will translate to greater profits.

It's too early to say whether mutual investors should move their money to Janus. The release revealing the Gross move was short on details and the relatively young fund he's going to manage isn't even reviewed by Morningstar.

Nor is it clear what strategy Gross plans to implement at Janus. Investors should also beware of the transaction fees that go along with moving money from one fund manager to another.

"He's not even in the saddle yet," said Burns.

The Scottish Vote: What It Means For All Of Us

Steve Forbes is Chairman and Editor-in-Chief of Forbes Media.

Steve's new book: Money: How the Destruction of the Dollar Threatens the Global Economy - and What We Can Do About It, co-authored by Elizabeth Ames (McGraw-Hill Professional) comes out next month.

Steve writes editorials for each issue of Forbes under the heading of "Fact and Comment." A widely respected economic prognosticator, he is the only writer to have won the highly prestigious Crystal Owl Award four times. The prize was formerly given by U.S. Steel Corporation to the financial journalist whose economic forecasts for the coming year proved most accurate.

In both 1996 and 2000, Steve campaigned vigorously for the Republican nomination for the Presidency. Key to his platform were a flat tax, medical savings accounts, a new Social Security system for working Americans, parental choice of schools for their children, term limits and a strong national defense. Steve continues to energetically promote this agenda.

Why the U.S. Dollar Is Rising, and Why It's Going to Fall

Make no mistake about why the U.S. dollar is rising; the long-term health of the world reserve currency is still as precarious as it ever was despite the recent pick-me-ups it's received in foreign exchange markets.

The U.S. Dollar Index, which charts the strength of the U.S. dollar against six world currencies through a weighted geometric mean, is up 5.2% this year, and 1.9% on the month.

But this is more an indication that traders should be bearish on other currencies, as opposed to bullish on the dollar.

The index is comprised of various currencies, each assigned a certain weight that goes into determining the index's final figure. The bulk of the calculation comes from the euro, which makes up 57.6% of the index, followed by the Japanese yen at a 13.6% weight, and the British pound sterling, which comprises 11.9%.

Together, these three currencies represent 83.1% of the index and explain why the main dollar index has been performing as well as it has this year.

The British pound sterling has been making headlines this week because it recently closed at its low on the year of $1.6105. Growing support from the Scottish independence movement has threatened to break up the U.K. and, as a result, stoked investor fears about the nation's currency and prompted some to exit.

No doubt this helped push the U.S. dollar index to a 14-month high, approaching levels it hasn't seen since July 2013. As of market close Tuesday, the dollar index reached $84.42.

But while the stories out of Great Britain may have given the dollar the boost it needed to approach yearly benchmarks, the strength of the dollar has been overstated for more than a year.

"Right now, there's little doubt that the weakening euro and British pound are helping to lift the dollar," said Money Morning Resource Specialist Peter Krauth. "Not that they deserve to be strong, given [quantitative easing]-type policies in both currency zones. I think the dollar's benefitting, as it has so many times in the past, from its safe-haven status, and that's what's pushing it higher temporarily."

Here's what the world's central bankers are doing to devalue their own currency...

The European Push Toward QE

European economic policymakers and central bankers are losing their appetite for wide-scale austerity measures first employed as the Eurozone crisis unfolded, and instead are more explicitly advocating inflationary monetary policies to jumpstart the region's stagnating economy.

Plagued by an elevated unemployment of 11.5% and troubling indicators signaling disinflation, the austerity calls are being hushed by much louder cries for stimulus.

With the most recent figures for European growth at 0.3%, its lowest level in five years, the European Central Bank (ECB) can't risk having this bout with disinflation morph into a full-on debt deflation trap.

Deflation would add to the real value of debt, hurting borrowers and raising the possibility of a credit crunch. This is the last thing the region needs when countries with the most troubled banks, such as Portugal, Ireland, Greece, and Spain, are beginning to find buyers of their debt outside of the International Monetary Fund (IMF) and European Union (EU) life-support lending facilities.

Inflation would also help bring current accounts in the Eurozone periphery into balance, a factor that has been acting as a headwind to a substantial recovery in the region.

ECB President Mario Draghi surprised Eurozone observers last week when he announced several rate cuts to the central bank's lending and deposit facilities and a plan to buy non-financial asset-backed securities to the tune of 500 billion euros over three years.

He also suggested that a large-scale sovereign bond-buying program, or European quantitative easing, was not far off when he said "Should it become necessary to further address risks of too prolonged a period of low inflation, the Governing Council is unanimous in its commitment to using additional unconventional instruments within its mandate."

This will all contribute to a weakening of the euro, and already has helped to prop the dollar up.

But the euro and the pound aren't the only currencies in a slump...

"Abenomics" Weakens the Japanese Yen

The Japanese yen has fallen 1.1% on the year, which comes as no surprise given its strict adherence to the so-called "Abenomic" policies that Japanese Prime Minister Shinzo Abe has pursued since December 2012.

"Abenomics" is made up of three main elements called "arrows" that include monetary easing, flexible fiscal policy, and structural reform. Since its inception in 2012, the yen has fallen more than 20%.

The first two arrows are the main culprits behind the yen's plunge.

The first, which entailed monetary policy changes in the Bank of Japan, was announced in April 2013 and known officially as "quantitative and qualitative monetary easing." It looked to increase the monetary base by 60 to 70 trillion yen a year. The program also included an annual purchase of long-term Japanese government bonds to the tune of 50 trillion yen a year to put downward pressure on interest rates.

This was accompanied by the second arrow, which addressed fiscal policy, and amounted to 10.3 trillion yen, or 1.4% of Japanese GDP, in debt-financed stimulus spending.

The multi-pronged "Abenomics" strategy explains why the yen has accelerated its downward plunge and contributed to the relative strength of the dollar.

But the dollar can only ride foreign central banker's missteps so long before it sees itself losing value...

Trouble Ahead for the U.S. Dollar

Over the last two months, the dollar has shot up over 5%, which is a huge move for any currency to make in such a short period, Money Morning's Krauth said.

He said he sees this as the peak, if it doesn't soon take out its highs experienced in July 2013.

The dollar is on fragile footing at the moment and likely can't sustain this rise.

The biggest threat to the dollar, at least in the short term, will come from the U.S. Federal Reserve, and any sudden policy measures that could instill a lack of confidence in the dollar moving forward.

"I think that what will eventually cause the dollar to weaken significantly will be something that is more U.S.-specific," Krauth said. "If much higher inflation expectations became entrenched, or if the Fed were to stop the current tapering process or even reverse and ramp it back up, then people could look to exit the dollar."

Even more troubling are the threats to U.S. dollar hegemony from China and Russia. The two countries are settling more international transactions in their own currencies, effectively bypassing the dollar all together.

These cues could signal that two major economic powers are weaning themselves off the dollar, further threatening the U.S. dollar's value in international markets.

All of these factors taken together paint a dismal future for the dollar, and put a damper on its recent gains, which themselves have been entirely sparked by forced currency devaluation measures of central bankers abroad.

"I don't think that we're going to see that stay all that strong for that much longer," Krauth said.

Editor's Note: We just released what may be the most important interview of the year on what's ahead for the U.S. economy and stock market. The Federal Reserve, Congress, and the White House are destroying our currency - and creating a $147.6 trillion problem they don't know how to solve. The biggest victims will be unprepared Americans who could see their entire financial future wiped out. Here's the full interview - plus the four steps to take now.

Carnival Corporation (CCL) Earnings Report: Smooth Sailing? CUK, RCL & NCLH

The Q3 2014 earnings report for cruise ship stock Carnival Corporation (NYSE: CCL), which also has a listing as Carnival plc (NYSE: CUK) and is a peer of Royal Caribbean Cruises Ltd (NYSE: RCL) and Norwegian Cruise Line Holdings Ltd (NASDAQ: NCLH), is scheduled to report earnings before the market opens on Tuesday (September 23rd). Aside from the Carnival Corporation earnings report, it should be said that Royal Caribbean Cruises Ltd reported Q2 2014 earnings on July 24th (profit rose fivefold on higher European demand) and Norwegian Cruise Line Holdings Ltd reported Q2 2014 earnings on July 29th (investments in new ships and fleet modernization helped earnings that beat expectations). However and the last time around when Carnival Corporation reported earnings, year over year comparisons may have been misleading because of an embarrassing February 2013 incident when a fire on the Carnival Triumph left the ship without power in the Gulf of Mexico and passengers stranded aboard the stalled ship for four days until it was pulled into port by several tugboats.

What Should You Watch Out for With the Carnival Corporation Earnings Report?

First, here is a quick recap of Carnival Corporation's recent earnings history along with EPS estimate trends from the Yahoo! Finance analyst estimates page:

Earnings HistoryAug 13Nov 13Feb 14May 14

EPS Est	1.30	0.00	-0.08	0.02
EPS Actual	1.38	0.04	0.00	0.10
Difference	0.08	0.04	0.08	0.08
Surprise %	6.20%	N/A	100.00%	400.00%

EPS TrendsCurrent Qtr.
Aug 14Next Qtr.
Nov 14Current Year
Nov 14Next Year
Nov 15

Current Estimate	1.44	0.20	1.74	2.37
7 Days Ago	1.44	0.20	1.75	2.37
30 Days Ago	1.44	0.20	1.75	2.36
60 Days Ago	1.44	0.20	1.74	2.36
90 Days Ago	1.51	0.18	1.72	2.36

 

Back in late June, Carnival Corporation reported second quarter revenues of $3.6 billion verses $3.5 billion for the prior year. Non-GAAP net income came in at $80 million, or $0.10 diluted EPS verses non-GAAP net income of $57 million, or $0.07 diluted EPS while GAAP net income, which included a net gain on vessel transactions of $15 million and net unrealized gains on fuel derivatives of $11 million, was $106 million, or $0.14 diluted EPS. For the second quarter of 2013, GAAP net income, which included a gain on a ship sale of $15 million and unrealized losses on fuel derivatives of $31 million, was $41 million for $0.05 diluted EPS. The President/CEO commented:

"We benefited from effective marketing initiatives, which combined with a gradually improving economic environment, led to revenue yield improvement for our continental European brands in the quarter compared to the prior year and is expected to continue through the remainder of the year. In addition, we achieved a six percent improvement in fuel consumption." 

And:

"Collectively our brands are gaining momentum in our efforts to drive higher ticket prices and we continue to expect sequential improvement in revenue yields, despite a more competitive environment in the Caribbean this summer. We remain focused on further understanding our guests and refining the exceptional customer experience we provide. We have also made significant strides in our efforts to identify opportunities for cross-brand operational efficiencies. This work is still in the early stages, but we are making progress and beginning to see encouraging signs. We believe we have reached a positive inflection point for our company as we return to earnings growth in 2014 and work hard to ensure that growth accelerates in the years to come."

After earnings, UBS analyst Robin Farley called the forecast a "surprise" for a quarter that would have plenty of European and Alaskan cruises to offset weakness in the Caribbean business (Note: About 35% of Carnival's passenger capacity was in the Caribbean in the year ended November). Industry analyst Stewart Chiron has also commented that Carnival Corporation and Royal Caribbean were pointing to Europe-based MSC Cruises that is offering 7-night cruises in the Caribbean for as low as $199.

On the news front and in early July, Jefferies said its latest pricing data at Carnival Corporation is weaker than in recent months and that it continues to see risks to 2015 consensus estimates. The firm reiterated an Underperform rating on the stock with a $33 price target, preferring Buy-rated Royal Caribbean. Jefferies noted that its pricing data supported Royal's 2014 earnings guidance.

Yesterday, UBS analyst Robin Farley said that cruise operators benefit from less capacity in mature markets, but those with the scale to deploy ships to China benefit the most - namely Carnival Corporation and Royal Caribbean Cruises. Next year, Carnival Corporation plans to move its fourth ship to China, the 2,928-berth Costa Serena, which sails in the Mediterranean.

What do the Carnival Corporation Charts Say?

The latest technical chart for Carnival Corporation shows shares bouncing around between two trend lines since the start of the year:

A long term performance chart shows that Carnival Corporation has underperformed both Royal Caribbean Cruises Ltd and Norwegian Cruise Line Holdings Ltd:

A technical chart for Royal Caribbean Cruises Ltd shows a strong and fairly steady uptrend while Norwegian Cruise Line Holdings Ltd hit rough seas back in the spring but has since recovered:

What Should Be Your Next Move?

Irrespective of the coming earnings report, I am not so sure about Carnival Corporation being the best cruise ship stock for investors. The industry is also highly cyclical with summer bookings being made in winter. Hence, the timing may not be right for new investors to take up positions in cruise ship stocks.

Technical Update: S&P May Have A Bit More Upside Left Before Healthy Sell-Off Starts

Related ES Technical Update: S&P Futures Support And Resistance Technical Update: S&P Futures Support And Resistance

Currently just above 2,000, the S&P futures have flipped the switch back "on" and are back in rally mode, Friday's quiet trading not withstanding.

Technicians are now providing a range of potential upside targets rather than a specific level; last week's update had them indicating that 2057 was the upside ceiling. They are now of the opinion that the "minis" will make it at least up to 2049 and possibly as high as 2066.

From there, they are looking for a pullback in the markets that will take the S&P e-Minis down at least 8 percent to 1861–1868.

Latest Ratings for ES DateFirmActionFromTo

Feb 2013	Imperial Capital	Downgrades	Outperform	In-line
Jan 2013	FBR Capital	Downgrades	Outperform	Market Perform
Dec 2012	Wedbush	Maintains		Neutral

View More Analyst Ratings for ES
View the Latest Analyst Ratings

Stock chart: 

Posted-In: Futures Price Target Technicals Markets Analyst Ratings Trading Ideas

© 2014 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

  Related Articles (ES) Technical Update: S&P May Have A Bit More Upside Left Before Healthy Sell-Off Starts Technical Update: S&P Futures Support And Resistance Technical Update: S&P Futures Support And Resistance Around the Web, We're Loving...

Sears: Worst Loan Ever?

OK, I’ll admit it right now: There’s more than a little bit of hyperbole in the headline. Still, the loan Sears (SHLD) just took out from its billionaire CEO isn’t making investors happy, as might be gathered by the stock’s big drop in reaction to the news.

ZUMAPRESS.com

The Wall Street Journal has the details on Eddie Lampert’s loan to Sears:

Sears Holdings Corp. is borrowing $400 million from Chief Executive Edward Lampert’s hedge fund, giving the retailer an infusion for the holidays after it burned through cash over the summer.

The loan is being made by entities affiliated with Mr. Lampert’s ESL Investments Inc. and secured by 25 of the company’s properties, Sears said in a securities filing on Monday.

The loan will mature on Dec. 31, though that could be extended until Feb. 28, assuming Sears doesn’t violate the terms of the loan.

Seems pretty innocuous right? Yahoo’s Jeff Macke dug into the filing to see what else was going on between Sears and Lampert–and it all comes down to those 25 stores:

That values the stores at $16 million apiece for the purposes of this loan. In reality Sears has been selling properties for anywhere between $20 and $50 million for the last few years. The company’s balance sheet list real estate assets of $5 billion. Bulls say the company’s 400 most valuable stores are worth at least $18 million a piece and the company has been selling locations for much more than that over the last year…In exchange for giving Sears the right to live through Christmas, Lampert will collect either $10 million in interest or his pick of 25 stores that could easily be worth more than half a billion.

S&P Capital IQ’s Efraim Levy reiterates his Strong Sell rating on Sears:

We reduce our 12-month target $5 to $28, or 0.9X our 2015 revenue per share estimate. We apply a historical and peer-discounted multiple, reflecting weakening financial performance and execution risk. We widen our FY 15 (Jan.) loss per share estimate $1.45 to $8.97, as we cut our revenue forecast 4.4%. Additionally, while Sear’s obtained $400 million in liquidity via a loan from CEO Lampert affiliated sources that should provide the funds needed to purchase inventory for the holiday selling season, we think it puts at risk, via liens, Sears real estate at discounted valuations.

Shares of Sears have dropped 7.2% to $31.10 at 12:15 p.m. today.

UPDATE: In hindsight, it probably should have added a little more context around the loan. For instance, 25 stores would be just 6% of those most valuable stores, and that collateral on these types of loans generally higher than the loan value itself. And as S&P Capital IQ’s Levy implies, having enough cash to get through the holiday season is essential for Sears’ future–just look at the speculation surrounding RadioShack (RSH) and the new iPhone. Still, the market has voted today, and it’s none to happy with the news. Shares of Sears have dropped 8.5% to $30.67 at 2:28 p.m.

4 Tech Stocks Rising on Unusual Volume

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.

Read More: 10 Stocks Billionaire John Paulson Loves in 2014

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.

Read More: 5 Rocket Stocks Ready for Blastoff This Week

FireEye

FireEye (FEYE) provides products and services for detecting, preventing and resolving advanced cybersecurity threats. This stock closed up 4.7% at $33.23 in Monday's trading session.

Monday's Volume: 10.59 million

Three-Month Average Volume: 5.82 million

Volume % Change: 150%

From a technical perspective, FEYE gapped up sharply higher here with strong upside volume flows. This spike to the upside on Monday briefly pushed shares of FEYE back above its 50-day moving average of $33.31. Shares of FEYE tagged an intraday high of $33.64, before it closed just below that level at $33.23. This gap to the upside is now starting to push shares of FEYE within range of triggering a near-term breakout trade. That trade will hit if FEYE manages to clear Monday's intraday high of $33.64 to some more near-term overhead resistance levels at $34.85 to $35.15 with high volume.

Traders should now look for long-biased trades in FEYE as long as it's trending above Monday's intraday low of $32.38 and then once it sustains a move or close above those breakout levels with volume that's near or above 5.82 million shares. If that breakout materializes soon, then FEYE will set up to re-test or possibly take out its next major overhead resistance levels at $37.39 to $41.82.

Read More: 10 Stocks Carl Icahn Loves in 2014

Autohome

Autohome (ATHM) operates as an online destination for automobile consumers in the People's Republic of China. This stock closed up 4.9% at $49.24 in Monday's trading session.

Monday's Volume: 1.45 million

Three-Month Average Volume: 784,573

Volume % Change: 67%

From a technical perspective, ATHM jumped higher here right above some near-term support at $44.31 with above-average volume. This move is starting to push shares of ATHM within range of triggering a near-term breakout trade. That trade will hit if ATHM manages to take out Monday's intraday high of $49.87 and then above some near-term resistance at $52 with high volume.

Traders should now look for long-biased trades in ATHM as long as it's trending above $47.50 or above more near-term support at $45 and then once it sustains a move or close above those breakout levels with volume that's near or above 784,573 shares. If that breakout gets underway soon, then ATHM will set up to re-test or possibly take out its next major overhead resistance level at its all-time high of $57.93.

Read More: 10 Stocks George Soros Is Buying

TIM Participacoes

TIM Participacoes (TSU), through its subsidiaries, provides telecommunication services in Brazil. This stock closed up 5% at $29.42 in Monday's trading session.

Monday's Volume: 3.24 million

Three-Month Average Volume: 985,592

Volume % Change: 215%

From a technical perspective, TSU ripped sharply higher here right above some near-term support at $27.50 with above-average volume. This stock recently gapped up sharply higher from around $25 to over $28 with heavy upside volume. Following that gap, shares of TSU have now resumed its uptrend and the stock is quickly moving within range of triggering a big breakout trade. That trade will hit if TSU manages to take out Monday's intraday high of $30 to its 52-week high at $30.52 with high volume.

Traders should now look for long-biased trades in TSU as long as it's trending above some key near-term support at $27.50 and then once it sustains a move or close above those breakout levels with volume that hits near or above 985,592 shares. If that breakout materializes soon, then TSU will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $35 to $38.

Immersion

Immersion (IMMR), an intellectual property and technology licensing company, creates, designs, develops and licenses technologies in North America, Europe, the Far East and internationally. This stock closed up 9% to $11.19 in Monday's trading session.

Monday's Volume: 1.10 million

Three-Month Average Volume: 255,197

Volume % Change: 284%

From a technical perspective, IMMR exploded sharply higher here right above some near-term support at $10.19 with heavy upside volume flows. This large spike to the upside on Monday also pushed shares of IMMR into breakout territory, since the stock took out some near-term overhead resistance levels at $10.79 to $11.15. Shares of IMMR are now quickly moving within range of triggering another big breakout trade. That trade will hit if IMMR manages to clear Monday's intraday high of $11.66 to its gap-down-day high from August at $11.98 with high volume.

Traders should now look for long-biased trades in IMMR as long as it's trending above $10.79 or above $10.50 and then once it sustains a move or close above those breakout levels with volume that hits near or above 255,197 shares. If that breakout hits soon, then IMMR will set up to re-fill some of its previous gap-down-day zone from August that started at $14.10.

Read More: 12 Stocks Warren Buffett Loves in 2014

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.

RELATED LINKS:

>>5 Stocks Set to Soar on Bullish Earnings

>>Hedge Funds Love These Consumer Stocks -- Should You?

>>5 Under-$10 Stocks Making Big Moves

Follow Stockpickr on Twitter and become a fan on Facebook.

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.

5 Hated Earnings Stocks You Should Love

DELAFIELD, Wis. (Stockpickr) -- Short-sellers hate being caught short a stock that reports a blowout quarter. When this happens, we often see a tradable short squeeze develop as the bears rush to cover their positions to avoid big losses. Even the best short-sellers know that it's never a great idea to stay short once a bullish earnings report sparks a big short-covering rally.

Read More: 5 Stocks Poised for Big Breakouts

This is why I scan the market for heavily shorted stocks that are about to report earnings. You only need to find a few of these stocks in a year to help enhance your portfolio returns -- the gains become so outsized in such a short time frame that your profits add up quickly.

That said, let's not forget that stocks are heavily shorted for a reason, so you have to use trading discipline and sound money management when playing earnings short-squeeze candidates. It's important that you don't go betting the farm on these plays and that you manage your risk accordingly. Sometimes the best play is to wait for the stock to break out following the report before you jump in to profit off a short squeeze. This way, you're letting the trend emerge after the market has digested all of the news.

Of course, sometimes the stock is going to be in such high demand that you risk missing a lot of the move by waiting. That's why it can be worth betting prior to the report -- but only if the stock is acting technically very bullish and you have a very strong conviction that it is going to rip higher. Just remember that even when you have that conviction and have done your due diligence, the stock can still get hammered if Wall Street doesn't like the numbers or guidance.

If you do decide to bet ahead of a quarter, then you might want to use options to limit your capital exposure. Heavily shorted stocks are usually the names that make the biggest post-earnings moves and have the most volatility. I personally prefer to wait until all the earnings-related news is out for a heavily shorted stock and then jump in and trade the prevailing trend.




With that in mind, here's a look at several stocks that could experience big short squeezes when they report earnings this week.

Read More: 5 Toxic Stocks You Need to Sell Now

G-III Apparel Group

My first earnings short-squeeze play is apparel player G-III Apparel Group (GIII), which is set to release numbers on Wednesday before the market open. Wall Street analysts, on average, expect G-III Apparel Group to report revenue of $390.98 million on earnings of 16 cents per share.

Recently, Wunderlich Securities initiated coverage on shares of G-III Apparel Group with a buy rating and a $92 per share price target. Wunderlich thinks the company's management team is in the right position to drive organic and acquisition-driven growth and that G-II Apparel Group is among the top-positioned players in the apparel sector.

The current short interest as a percentage of the float for G-III Apparel Group is notable at 7.3%. That means that out of the 17.42 million shares in the tradable float, 1.28 million shares are sold short by the bears. This is a decent short interest on a stock with a very low float. Any bullish earnings news could easily spark a sharp short-covering rally post-earnings as the bears jump to cover some of their bets.

From a technical perspective, GIII is currently trending above both its 50-day and 200-day moving averages, which is bullish. This stock has been uptrending a bit over the last month, with shares moving higher from its low of $76.43 to its recent high of $84.95 a share. During that move, shares of GIII have been consistently making higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of GII within range of triggering a big breakout trade post-earnings.

If you're bullish on GIII, then I would wait until after its report and look for long-biased trades if this stock manages to break out above its 52-week high at $84.95 a share with high volume. Look for volume on that move that hits near or above its three-month average volume of 226,675 shares. If that breakout triggers post-earnings, then GIII will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $100 to $110 a share.

I would simply avoid GIII or look for short-biased trades if after earnings it fails to trigger that breakout and then drops back below its 50-day moving average of $80.54 a share with high volume. If we get that move, then GIII will set up to re-test or possibly take out its next major support levels at $76.43 to its 200-day moving average of $73.26 a share.

Read More: 5 Rocket Stocks to Buy for a Short Trading Week

Navistar International

Another potential earnings short-squeeze trade idea is heavy machinery and vehicles player Navistar (NAV), which is set to release its numbers on Wednesday before the market open. Wall Street analysts, on average, expect Navistar to report revenue $2.96 billion on a loss of 66 cents per share.

The current short interest as a percentage of the float for Navistar is extremely high at 29%. That means that out of the 34.79 million shares in the tradable float, 10.10 million shares are sold short by the bears. If the bulls get the earnings news they're looking for, then shares of HAV could easily rip sharply higher post-earnings as the bears rush to cover some of their positions.

From a technical perspective, NAV is currently trending above both its 50-day and 200-day moving averages, which is bullish. This stock has been uptrending over the last month, with shares moving higher from its low of $33.59 to its recent high of $39.26 a share. During that uptrend, shares of NAV have been making mostly higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of NAV within range of triggering a major breakout trade post-earnings above some key overhead resistance levels.

If you're in the bull camp on NAV, then I would wait until after its report and look for long-biased trades if this stock manages to break out above some key overhead resistance levels at $39.26 to $39.45 a share with high volume. Look for volume on that move that hits near or above its three-month average volume of 684,080 shares. If that breakout hits post-earnings, then NAV will set up to re-test or possibly take out its next major overhead resistance level at its 52-week high of $41.57 a share. Any high-volume move above that level will then give NAV a chance to make a run at $45 to $50 a share.

I would simply avoid NAV or look for short-biased trades if after earnings it fails to trigger that breakout and then drops back below both its 50-day at $37 a share to its 200-day at $36.35 a share with high volume. If we get that move, then NAV will set up to re-test or possibly take out its next major support levels at $33.59 to $32 a share.

Read More: Warren Buffett's Top 10 Dividend Stocks

Ciena

Another potential earnings short-squeeze candidate is communications networking equipment player Ciena (CIEN), which is set to release numbers on Thursday before the market open. Wall Street analysts, on average, expect Ciena to report revenue of $600.81 million on earnings of 29 cents per share.

The current short interest as a percentage of the float for Ciena is extremely high at 17.5%. That means that out of the 103.42 million shares in the tradable float, 18.16 million shares are sold short by the bears. If this company can deliver the earnings news the bulls are looking for, then shares of CIEN could easily rip sharply higher post-earnings as the bears move quickly to cover some of their positions.

From a technical perspective, CIEN is currently trending above its 50-day moving average and just below its 200-day moving average, which is neutral trendwise. This stock recently formed a double bottom chart pattern at $18.54 to $18.64 a share. Following that bottom, shares of CIEN have started to uptrend with the stock moving back above its 50-day moving average. That move has now pushed shares of CIEN within range of trade triggering a near-term breakout post-earnings above some key overhead resistance levels.

If you're bullish on CIEN, then I would wait until after its report and look for long-biased trades if this stock manages to break out above some near-term overhead resistance at $20.98 a share to its 200-day moving average at $21.65 a share and then above more key resistance levels at $22.50 to $23 a share with high volume. Look for volume on that move that hits near or above its three-month average action of 3.07 million shares. If that breakout develops post-earnings, then CIEN will set up to re-test or possibly take out its next major overhead resistance levels at $24.21 to $24.80 a share, or even $27 to its 52-week high at $27.94 a share.

I would avoid CIEN or look for short-biased trades if after earnings it fails to trigger that breakout and drops back below its 50-day moving average of $20.24 a share to more near-term support at $20 a share with high volume. If we get that move, then CIEN will set up to re-test or possibly take out its next major support levels at $18.64 to $18.54 a share. Any high-volume move below those levels will then give CIEN a chance to re-test or possibly take out its 52-week low of $18 a share.

Read More: 10 Stocks George Soros Is Buying

Vince Holding

Another earnings short-squeeze prospect is diversified apparel player Vince Holding (VNCE), which is set to release numbers on Wednesday before the market open. Wall Street analysts, on average, expect Vince Holding to report revenue of $83.92 million on earnings of 24 cents per share.

The current short interest as a percentage of the float for Vince Holding is pretty high at 8.1%. That means that out of the 14.82 million shares in the tradable float, 1.21 million shares are sold short by the bears. This is a decent short interest on a stock with a very low tradable float. Any bullish earnings news post-earnings could easily set off a sharp short-covering rally for shares of VNCE post-earnings that forces the bears to cover some of their trades.

From a technical perspective, VNCE is currently trending above its 50-day moving average, which is bullish. This stock has been uptrending over the last month, with shares moving higher from its low of $32.19 to its recent high of $38.10 a share. During that uptrend, shares of VNCE have been consistently making higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of VNCE within range of triggering a big breakout trade post-earnings.

If you're bullish on VNCE, then I would wait until after its report and look for long-biased trades if this stock manages to break out above some key overhead resistance levels at $38 a share to its all-time high at $38.10 a share with high volume. Look for volume on that move that registers near or above its three-month average action of 312,569 shares. If that breakout materializes post-earnings, then VNCE will set up to enter new all-time-high territory, which is bullish technical price action. Some possible upside targets off that move are $50 to $55 a share.

I would simply avoid VNCE or look for short-biased trades if after earnings it fails to trigger that breakout and then takes out its 50-day moving average of $34.78 a share to more near-term support at $34 a share with high volume. If we get that move, then VNCE will set up to re-test or possibly take out its next major support level at $32.19 a share. Any high-volume move below that level will then give VNCE a chance to tag its next major support levels at $29 to $27 a share.

Read More: 3 Stocks Spiking on Unusual Volume

Hovnanian Enterprises

My final earnings short-squeeze play is homebuilding player Hovnanian Enterprises (HOV), which is set to release numbers on Thursday before the market open. Wall Street analysts, on average, expect Hovnanian Enterprises to report revenue of $559.57 million on earnings of 9 cents per share.

The current short interest as a percentage of the float for Hovnanian Enterprises is very high at 16.6%. That means that out of the 117.35 million shares in the tradable float, 19.56 million shares are sold short by the bears. The bears have also been increasing their bets from the last reporting period by 5.9%, or by about 1.08 million shares. If the bears get caught pressing their bets into a bullish quarter, then shares of HOV could easily explode sharply higher post-earnings as the shorts rush to cover some of their positions.

From a technical perspective, HOV is currently trending below both its 50-day and 200-day moving averages, which is bearish. This stock has been uptrending a bit over the last month, with shares moving higher from its low of $3.75 a share to its recent high of $4.40 a share. During that move, shares of HOV have been making mostly higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of HOV within range of triggering a near-term breakout trade post-earnings above some key overhead resistance levels.

If you're in the bull camp on HOV, then I would wait until after its report and look for long-biased trades if this stock manages to break out above some key near-term overhead resistance levels at $4.40 to $4.75 a share with high volume. Look for volume on that move that registers near or above its three-month average action of 2.70 million shares. If that breakout develops post-earnings, then HOV will set up to re-test or possibly take out its next major overhead resistance levels at its 200-day moving average of $4.98 a share to $5.31 a share. Any high-volume move above $5.31 a share will then give HOV a chance to tag $6 a share.

I would avoid HOV or look for short-biased trades if after earnings it fails to trigger that breakout, and then drops back below some key near-term support levels at $4.13 to $4 a share with high volume. If we get that move, then HOV will set up to re-test or possibly take out its next major support level at its 52-week low
of $3.75 a share. 


Read More: 7 Stocks Warren Buffett Is Selling in 2014

To see more potential earnings short squeeze plays, check out the Earnings Short-Squeeze Plays portfolio on Stockpickr.

-- Written by Roberto Pedone in Delafield, Wis.

RELATED LINKS:

>>3 Tech Stocks on Traders' Radars

>>5 Stocks With Big Insider Buying

>>Must-See Charts: 5 Big Trades for S&P 2,000

Follow Stockpickr on Twitter and become a fan on Facebook.

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.