Looking For Penny Stocks Gapping Up Pre Market?
Premarket penny stocks are interesting to watch. While big gap ups or gap downs are exciting, they don’t typically dictate the pace once the opening bell rings. Obviously, this isn’t the case for all penny stocks. But as a general rule of thumb, people trading premarket penny stocks typically enter and exit the trade before the opening bell.
There are, of course, others who will simply observe. You can’t ignore the fact that some cases see pre market gappers take off flying at the open. However, it’s important to not only understand why but grasp the general market risk at play.
Think about it. If you owned shares of a stock “yesterday” and saw it was up over 100% “today,” would you take profit? In most cases, moderate traders would agree. So when you put a pre market penny stocks watch list together, it doesn’t hurt to look at previous trading sessions.
How To Trade Premarket Penny Stocks
What type of volume was present? Has the specific penny stock done this before and if so what happened? What is the share structure like? Is it a low float penny stock or does it have a large share structure? Furthermore, and very important is the company’s debt structure. Has it raised money recently? If so, how much did it raise, and at what price did it raise funds?
These are all questions you should try to find answers for. That’s especially true if you’re thinking about how to trade penny stocks gapping up or down. This leads me to my next point. As long as you weren’t “in” a stock prior, penny stocks gapping down might not be as bad as you think. Now, I will say that there’s likely a lot more selling pressure to deal with. However, some gap down penny stocks end up doing what’s called a “dead cat bounce,” and yes that’s a technical term.
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What is a dead cat bounce? This is something more suited for traders than investors in most cases. A dead cat bounce is a brief recovery in prices after a steep decline. It’s typically small and short-lived, however, for active day traders, we’ve seen this example when companies release bad news, yet still offer favorable guidance. It’s one of the popular trends when looking at certain biotech penny stocks that might miss an endpoint in a phase trial. In any case, I won’t get too deep into technical analysis but I thought it was something worth mentioning. Heading into Wednesday’s session, will these be on your list of premarket penny stocks to buy or avoid today?
Penny Stocks To Buy [or avoid]: SPI Energy Co Ltd.
SPI Energy Co Ltd. (SPI Stock Report) has been in a prolonged downtrend for over a month now. After mounting a 5-month recovery from March, the penny stock began sliding in mid August. The initial catalyst came after the company filed a mixed shelf offering to raise up to $100 million (something to keep in mind down the road). Furthermore, the Board had also approved a spin off of the company’s SP Orange Power subsidiary via IPO. This was its independent power producer in Europe.
As a provider of photovoltaic solutions, the company has been one of the few “alternative energy” stocks that hasn’t jumped. That might’ve changed; at least briefly. This week, Tesla hosted its Battery Day and shareholder meeting. While that was a bit lackluster, Tesla stock slumped on a “buy the rumor, sell the news” event. But that doesn’t seem to have quelled the rampant FOMO surrounding EV stocks (electric vehicle stocks).
Why do I bring this up? That has a lot to do with SPI’s recent development. Wednesday morning saw the company announce that it the launch of EdisonFuture, Inc. Not only will EdisonFuture develop electric vehicles, it will also create EV charging solutions. We’ll have. to see how this new venture unfolds. For now, however, SPI stock surged during pre market trading on Wednesday.
Penny Stocks To Buy [or avoid]: 9 Meters Biopharma Inc.
9 Meters Biopharma Inc. (NMTR Stock Report) is another one of the penny stocks gapping up on Wednesday. The penny stock has been in a slight uptrend since mid August. The initial spark that was a catalyst to the first big move in the stock came as one of the company’s directors reported a large insider buy. This triggered a move to highs of $1.11 but it wasn’t a sustainable move and NMTR stock pulled back.
During the last few weeks, shares have remained steady in a slight uptrend. 9 Meters also had announced the formation of a Scientific Advisory Board at the end of last month. 9 Meters is a gastroenterology company. It’s advancing NM-002, a proprietary long-acting GLP-1 agonist into a Phase 2 trial for Short Bowel Syndrome (SBS) as well as larazotide, a Phase 3 tight junction regulator being evaluated in non-responsive celiac disease. Its scientific board was made up of experts in this field.
This week, we’re seeing NMTR stock climb higher after William Blair initiated coverage on 9 Meters. The initial rating was set at “Outperform”. The company was also given a $5 price target. What’s more is that today, 9 Meters also presents at an industry conference before lunch. CEO John Temperato presents at the Oppenheimer Fall Healthcare Life Sciences & MedTech Summit later this morning.
Penny Stocks To Buy [or avoid]: Predictive Oncology Inc.
Shares of Predictive Oncology Inc. (POAI Stock Report) were actually trading higher in Tuesday’s aftermarket session. The company had announced that it secured a license for an additional 71 unique ovarian cancer cell lines. That brings its total to 96 unique patient derived cells from ovarian cancer patients. These cell lines were licensed from the English company, Ximbio, the world’s largest non-profit dedicated to life science reagents of all kinds.
Predictive’s TumorGenesis subsidiary specializes in media’s that help cancer cells grow and retain their DNA/RNA and proteomic signatures. This provieds researchers with a tool to expand and study cancer cell types found in tumors of the blood and organ systems of all mammals, including humans.
“This new media will allow researchers around the world to isolate and culture ovarian cancer cell types and, in addition, culture them reproducibly to find new targets for the diagnostics, treatment, or any other needed studies on the close interrelationship of ovarian cancer tumor populations and how they are able to fool a patient’s immune system.”Richard Gabriel, President of TumorGenesis
With so much selling pressure on the stock recently, will POAI actually manage to continue this trend? Or are shares set to slide by the close?