These Penny Stocks Have Seen Explosive Moves; Is That The Case Right Now?
Penny stocks are quiet until they’re not. Over sold penny stocks are bad until they aren’t. Illiquid stocks under $5 aren’t worth it until they are. At the end of the day, these cheap stocks can present huge wins and, on the other end, big losses within the blink of an eye. The fact is that most penny stocks are catalyst driven. As we’ve seen this year, whether it’s industry news (I.E. COVID-19 vaccines), corporate updates, or SEC filings, most penny stocks react with some type of news.
Ok, so now you’ve got the obvious. And while this is the case for “most” penny stocks, there are other reasons that could be behind a breakout rally. Maybe the company was mentioned by a high-profile influencer. The company’s business could have been highlighted in an industry journal or maybe penny stocks broke out simply due to a short squeeze.
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No matter the case, it’s important to know at least the basics before jumping blindly into a “YOLO trade”. These are the ones that have continued to produce some incredible bagholders over the years. I say that with sarcasm. But all the same, a little research could keep you from buying close to the top only to lose your hard-earned cash in a losing trade that was only a winner for some.
Are Penny Stocks Right For Me?
So this leads me to the question of the day, “Are penny stocks right for you?” It seems like a simple question but it’s easier said than done. Some traders think it’s easy to make money with penny stocks. But your goal shouldn’t be to do that a few times. Your goal should be focused on consistently doing that over and over again. That’s without being uncertain of how you’re doing it. This is where a strategy and a sound psychology will play bigger roles.
Do you get overly excited when a stock breaks out and immediately say “I’m not selling now because what if…”? Or what if a stock is pulling back and you contemplate selling because “Oh no I’m losing money”? These knee-jerk reactions to momentum shifts tend to suggest that you need to spend more time working on your strategy and less time treating the stock market like the lottery. Simply put, luck shouldn’t have a place in your stock trading toolbox.
If you have a hard time handling volatility, then I would suggest stepping back and working on not only your trader-psychology but also on your overall approach to trading. Learning how to trade on your own without depending on someone else’s Twitter account or Reddit account means that you will know how to “fish” on your own; not just have someone feed you “picks”.
Mastering this simple task can pay dividends by either saving you money by avoiding bad set-ups or making you money by finding high-quality trades. With this in mind, are any of these penny stocks set to finish June on a high note?
Penny Stocks To Buy [or avoid]: iBio Inc.
iBio Inc. (IBIO Stock Report) has been a popular penny stock to watch during coronavirus. To be honest, it’s been one of the top names to follow on our site ever since last December. But as we know, things heated up in a big way when IBIO started getting mentioned alongside other coronavirus penny stocks. Believe it or not, when we first started looking at iBio, the penny stock was trading around $0.20. If you look at a chart, I’m sure you can see how crazy things have gotten.
But this isn’t to say that IBIO stock hasn’t seen its share of volatility. Sure, it raced to highs of $3.40 this year but it also pulled back to lows of $0.76 a little over a month later. This quarter was another growth quarter for the company in terms of market momentum. Most recently iBio was selected by IBM Watson Health to receive 18 months of use of the IBM Clinical Development solution for free.
IBM Watson Health recently began offering its ICD solution to eligible trial sponsor organizations as part of its efforts to help support the medical community to address the COVID-19 pandemic. IBM Watson Health has received interest in the offering from numerous hospitals, sponsors, contract research organizations and academic institutions, and is currently enabling 15 COVID-19 disease trials. Thanks to news like this IBIO stock has seen a favorable reaction in the stock market this week. Given the uptick in VODI-19 cases, will IBIO stock continue along this bullish path?
Penny Stocks To Buy [or avoid]: Aytu BioScience, Inc.
Another one of the big coronavirus penny stocks to watch this year was Aytu BioScience, Inc. (AYTU Stock Report). In late-February, this penny stock first hit the radar. At the time AYTU stock was trading around $0.75 and the company had just closed on an acquisition of Innovus Pharmaceuticals. Fast-forward a bit and Aytu had managed to jump to highs of $2.99 about 2 weeks later. Similar to IBIO, AYTU stock also was very volatile and dropped quickly back to around $0.80, which also happened to be its 200-Day Moving Average.
Needless to say, AYTU stock has maintained this lower level of support (200DMA) ever since, while also increasing to around $1.50. This month the company announced that it would be joining the Russell 3000® Index. Membership in the Russell 3000® Index, which remains in place for one year, means automatic inclusion in the large-cap Russell 1000® Index or small-cap Russell 2000® Index as well as the appropriate growth and value style indexes.
FTSE Russell determines membership for its Russell US Indexes primarily by objective, market-capitalization rankings and style attributes. Guess when that is set to take place. If you said June 26, you’d be right. Knowing this to be the case, will this signal a momentum-fueled close to the month?
Penny Stocks To Buy [or avoid]: ReWalk Robotics Ltd.
Many of us saw the epic rally that Ekso Bionics (EKSO Stock Chart) had on Thursday. Those that read our articles and saw the premarket update today saw it when it was still considered a penny stocks. That changed dramatically as EKSO stock managed to soar above $11 during after-hours trading. With such aggressive breakouts, traders likely search for “sympathy trades,” which are usually stocks with either similar business models, share structures, industries, etc.
ReWalk Robotics Ltd. (RWLK Stock Report) was one of the “Strong Buy Penny Stocks” according to analysts back in April. At the time RWLK stock traded around $1. Jump ahead to this month and the medical device maker has seen its shares reach highs of $2.10. The company develops and commercializes exoskeletons to allow wheelchair-bound individuals to stand and walk. Despite an earnings miss, the company hit a few important milestones in June. First, ReWalk announced that the Centers for Medicare and Medicaid Services – CMS – conducted a public hearing to discuss requests for new billing codes.
This included CMS’s positive preliminary decision for ReWalk’s request for a Healthcare Common Procedure Coding System – HCPCS – Level II Code. The preliminary decision is an important moment for exoskeleton devices. ReWalk said to date, have not had a distinct HCPCS billing code for claim submissions. Then ReWalk announced positive safety results and reliability of its ReStore exo-suit for rehabilitation in the Journal of NeuroEngineering & Rehabilitation. Is there more runway for RWLK stock to rally or is this just some sympathy momentum that could wear off before Q3?