One of the tell-tale signs that the market is interested in penny stocks is by looking at the volume. Take a look at certain ETFs like the iShares Russell 2000 ETF (IWM ETF Report). This tracks a bunch of small-cap stocks, not all, but can give a broader view for traders.
If you look at the volume from this year compared to last, there’s a clear difference in trading volumes. Personally, I think it’s had a lot to do with people being stuck at home. Regardless of the ultimate reason for higher trading volumes, the fact remains, penny stocks are hot right now.
So where do you start if you’re just getting your feet wet? In my opinion, begin with what you know. If you understand headlines and see that there is a focus on things like coronavirus, biotech, or even food delivery companies, maybe those sectors are gaining momentum.
For instance, when it comes to apps like Uber Eats or Postmates, they saw a surge in traffic this year. Just like most blue-chip stocks, there are penny stocks that move in sympathy with them. So we saw names like Blue Apron (no longer a penny stock) and Waitr Holdings (WTRH Stock Report) moving up along with Uber stock, for example. We covered WTRH stock for months leading up to the pandemic. Then watched as stay at home orders sparked and continue to fuel a very bullish trend in that penny stock. In fact, since we began following closely, we’ve seen WTRH stock break out from right around $0.30 to highs of over $4.50 this week. Read More On Waitr Holdings Here
Once you get more comfortable with trading, you might start looking for irregularities to identify opportunities. One of the “go to-s” is unusual volume. Since penny stocks are usually short term trades, spikes in volume can be a sign of speculative momentum. Whatever your means of finding penny stocks to buy, the goal is the same: make money then repeat the process.Top Penny Stocks To Watch: New Wave Holdings
Market Cap: $10.81M
New Wave Holdings (SPOR Stock Report) is somewhat of a newcomer to the list of penny stocks to watch recently. Shares trade mostly in Canada but it does look like the U.S. has started to pique some interest. A new trend is beginning to emerge in North America right now and that is magic mushrooms. That’s right, psychedelic penny stocks are becoming a “thing” right now. The growing intrigue in non-opioid treatment for neurologic diseases has found a home in things like ketamine, psilocybin, and even LSD.
A few years ago, we got an introduction to the legal cannabis industry. Once thought of as something on the fringes of health and wellness, it has now become a multi-billion-dollar market. However, with the opioid crisis, there’s a dire need for alternative medicine focused on mental health. This has sparked blooming interest in advancing psychedelics used in a controlled setting.
Considering the market opportunities for each of these industries are in the multi-billion dollar range, companies like New Wave could have carte blanche right now. New Wave has quickly found that there’s more to this new industry than just medical-only psychedelics. As a result, the company has taken full advantage of this. Much like how the first movers of CBD and non-psychoactive cannabis products established market dominance early on, New Wave is taking up a similar approach.
This includes New Wave Recreational, New Wave Natural, and, of course, New Wave Mental Health. Aside from appointing more advisors, New Wave is actively sponsoring psychedelic studies as well. Most recently the company supported the Delos Psyche Research Group in its study designed to determine the impact of ingesting small amounts of hallucinogenic or psychedelic substances for medicinal or therapeutic purposes.Penny Stocks To Watch: Bionano Genomics Inc.
Market Cap: $58.22M
Bionano Genomics Inc. (BNGO Stock Report) has been on our list of penny stocks to watch for a few months. Since the end of April, BNGO stock has not only been on the move, it has also seen its average daily volume picking up as well. Prior to this, Bionano announced the launch of the largest study to date that targets identifying certain substances related to resistance or sensitivity to COVID-19.
Obviously coronavirus penny stocks continue heating up the stock market. This week BNGO stock pushed even higher after its latest update. After the market closed on July 16, Bionano announced that the first-ever complete assembly of a human chromosome utilized its genome imaging technology to assemble the genome correctly and verify the accuracy. In a publication in Nature*, an international team described the assembly of a complete, gap-free build of the human X chromosome, covering telomere to telomere in a single contiguous stretch. Optical mapping data generated with Bionano’s genome imaging instrument Saphyr was considered the ground truth for the genome structure. it was also used to correct several assembly errors throughout the chromosome.
Bionano’s Saphyr system is a platform for ultra-sensitive and ultra-specific structural variation detection. It enables researchers and clinicians to accelerate the search for new diagnostics and therapeutic targets. Thanks to this update, the market has perked up once again and BNGO stock made a new 3-month high of $0.87. Will this momentum continue through next week? Leave us a comment below.Penny Stocks To Watch: Allena Pharmaceuticals
Market Cap: $68.56
Allena Pharmaceuticals (ALNA Stock Report) saw its highest trading volume day in over a year on Friday. By the lunch hour, ALNA stock traded more than 9 million shares and reached morning highs of $2.25, a jump of over 40% from Thursday’s close. There hasn’t been any news or filings from the company in over a month.
Allena is a late-stage clinical biopharmaceutical company that develops and commercializes oral enzyme therapeutics. Main treatments focus on patients with rare and severe metabolic and kidney disorders. Specifically, Allena targets excess accumulation of certain metabolites that can lead to chronic kidney disease. Something that could have sparked some additional interest this week were analysts. Ladenburg Thalmann and Roth Capital both reiterated their ratings on ALNA stock.
Currently Roth Capital holds a Buy Rating on the penny stock. It has also issued a price target of $11. Ladenburg also rates the penny stock a “Buy” but had set an $8 price target according to data from MarketBeat. Older ratings from H.C. Wainwright have Allena with a Buy rating. H.C. essentially split the difference an put a target of $10 on ALNA. Will this momentum continue to push this bullish narrative in the stock market for July?Penny Stocks To Watch: Ideanomics Inc.
Market Cap: $225M
Famous or infamous? Whichever category you put it in, Ideanomics Inc. (IDEX Stock Report) has started trending on July 17th. Shares have been in a downtrend ever since the beginning of July. There haven’t been many new updates this month besides clearing up a bunch of uncertainties among the investing public.
The last few weeks have been full of questions raised as to the validity of Ideanomics’ Asian operations. Furthermore, the company went further and brought on Harvest Alternative Investments to act as an advisor with emphasis on Ideanomic’s Mobile Energy Global division.
According to the press release associated with this move, the types of advisory activities include the potential to assist with capital raising, M&A, and other types of investment banking services for MEG and Medici Motor Works. IDEX stock has build up somewhat of a cult-following over the last few months. In the wake of Tesla’s massive run and Nikola’s IPO, EV penny stocks surged this quarter. Something that has traders interested this week is options activity in the penny stock.
Not only is there growing open interest in IDEX call contracts through August, volume picked up in 1 option in particular on Friday. The August 21 $1 call saw more than 21,000 contracts traded by the lunch hour. With earnings planned for August 11th, the is the first expiration date after earnings. Sometimes traders will focus on options activity to see where “bets” are being placed in relation to certain pre-announced corporate events like earnings. Does this mean traders are bullish on IDEX stock or are they simply hedging a prior bearish bet?
BNGO*: (Miga, K.H., Koren, S., Rhie, A. et al. Telomere-to-telomere assembly of a complete human X chromosome. Nature (2020). https://doi.org/10.1038/s41586-020-2547-7)