Penny Stocks Continue Captivating The Market
If you look at the top 10 most active stocks in the market today by volume, more than half were penny stocks. This has remained a key theme in January, with new traders flocking to cheap stocks. Are they worth the time? Well, apparently so, and retail traders don’t seem like they’re going anywhere else anytime soon to gain exposure to volatility. Now, for this article, I’m focusing on listed stocks. These are sometimes referred to as Robinhood stocks. Based on volume, the majority of the top 10 most active stocks were penny stocks on Tuesday.
We began seeing this type of trend ensue over the last few weeks. Now it appears things are reaching a feverish pitch. I’m not talking about a few hundred million shares traded. Among the most active penny stocks in the top 10, collectively, these names traded more than 1.3 billion before the closing bell. With penny stocks dominating the market, traders continue to look for new opportunities. So, where should you look next?
Which Penny Stocks Are Hot Right Now?
We have seen several sectors and industry trends emerge. Some are more niche, while others are broader. However, what we can see and the resounding theme is simply momentum. Traders look for whispers of unusual volume, hoping to catch lightning in a bottle before other traders catch on.
The strategy itself is something that day traders frequently use by studying technical indicators. Is this style best for finding good penny stocks to invest in? In my opinion, no, and that has everything to do with the speed that these momentum stocks are moving at. Many of these cheap stocks jump hundreds of percentage points within the blink of an eye.
This is what has attracted millions of new traders to the market and penny stocks recently. With that in mind, here are a few top penny stocks to watch that have also seen an uptick in trading activity this week.
Top Penny Stocks To Watch
- Motus GI (NASDAQ: MOTS)
- Guardion Health Sciences Inc. (NASDAQ: GHSI)
- Conformis Inc. (NASDAQ: CFMS)
- Arca Biopharma Inc. (NASDAQ: ABIO)
- Cyren Ltd. (NASDAQ: CYRN)
This was one of the penny stocks we talked about last week. Motus gained some interest from traders thanks to a key update. The company announced that it received approval from the EU notification body, DEKRA, for enhancements to its Pure-Vu GEN2 colonoscopy system.
Tim Moran, chief executive officer of Motus GI, explained, “As we look to establish the foundation for bringing our innovative Pure-Vu solution to healthcare providers and patients around the world, we’ve implemented processes that actively collect customer feedback and data which allow us to respond quickly with system updates to enrich the user experience.”
With the growing body of traders looking at medical tech stocks, MOTS seems to have struck a chord. As far as analysts are concerned, Piper Sandler is one with a bullish outlook on the company. The firm has an Overweight rating on the stock with a $2.50 price target.
Guardion Health Sciences Inc.
Guardion is another one of the frequently discussed penny stocks recently. It’s also one of the stocks under $1 that many traders have searched for. A lot has happened since we started following along at the start of December. The company has various products for use in the biotech space’s medical food and medical device niches. No news has come out this year to pair with the recent trend in GHSI stock. But what we can see is that speculative trading may have stemmed from previously announced updates.
In particular, Guardion launched a new vision support/energy drink for the U.S. and global markets. Marketed as Epiq-V, the company is targeting an adult demographic in support of vision health. Another interesting addition to that news was that the company is developing another formulation geared toward a youth market. Specifically, Guardion is targeting a youth customer base in the video gaming niche.
Why does this matter right now? The initial round of testing was already completed last year. The final round is expected to be completed by the end of this quarter, with commercial products available 12-16 weeks later. Given this near-time timeline, it could be one reason why GHSI is on a list of penny stocks to watch right now.
We’ve covered Conformis Inc. several times in the past month or so. This is because CFMS has shown a great deal of bullish sentiment and momentum. In the past few weeks, shares of Conformis have shot up by over 90%, which is quite a lot by any metric. The company works as a biotech firm specializing in joint replacement products. This includes its iTotal PS product, which can help to replace ligaments in those who need it. Additionally, the company offers the iUni, which is used in full replacement knee surgery.
One thing to keep in mind is that this market is fairly specific. This means that there are some clear cut pros and cons. On the one hand, being a specialty product provider has a unique competitive landscape. This might also mean that Conformis could become the leader in this specific area thanks to a more specialized offering. On the flip side, there needs to be enough demand for its products for Conformis to see continued success. The latter does not seem to be an issue as knee surgeries have resumed almost to their pre-covid levels.
We’ll likely get a glimpse of how the company has performed before the end of this quarter. Conformis will release its Q4 financial results in March. The company is also coming off of a series of industry presentations that became the center of focus these first few weeks of 2021.
Arca Biopharma Inc.
This week, Arca Biopharma continued its move higher, which has now extended a 2-month move that began in November. During that time, ABIO stock managed to rally more than 20%. This move was initially sparked by COVID-related news in November. In particular, the FDA designated the investigation of its AB201 as a Fast Track development program for the potential treatment of COVID-19. A Phase 2b clinical trial (ASPEN-COVID-19) of AB201 is set to enroll roughly 100 patients hospitalized with COVID-19. The first patients were enrolled in this trial last month.
Dr. Michael Bristow, ARCA’s President, and Chief Executive Officer went further to say, “We believe rNAPc2’s combination of anticoagulant, anti-inflammatory, and antiviral effects may favorably impact clinical recovery of patients hospitalized with COVID-19, and we look forward to completing the ASPEN -COVID-19 trial evaluating rNAPc2’s potential efficacy in this patient population.”
With topline trial data anticipated in the second quarter of this, ABIO has gained plenty of speculative interest. The question now is, can this recent uptick in momentum continue throughout the rest of this quarter?
Finally, Cyren Ltd. joins this list of active penny stocks following a big update on Tuesday. The tech company announced that its Cyren Inbox Security solution is now available through Microsoft’s Azure Marketplace. The solution is designed to provide a layer of defense in protecting enterprises from email-based phishing attacks.
“Making Cyren Inbox Security available in the Azure Marketplace will help us drive awareness and increased adoption of our unique anti-phishing approach,” said Lior Kohavi, Cyren’s Chief Strategy Officer.
Cloud computing stocks have been a popular niche focus for traders this year. The IPOs of companies like Snowflake have brought attention to the industry, and for a good reason. The cloud environment has opened doors for scalability and efficiency across a broad spectrum of consumers. With this news, Cyren extends its reach into the Azure ecosystem and, with that, a new group of potential users.
Are Penny Stocks Part Of Your Strategy Right Now?
Obviously, you can’t ignore the excitement coming from this part of the market. Penny stocks are the hot-ticket item right now and it doesn’t look like that’s slowing down. With such an uptick in trading volume and momentum, it’s important to know how to navigate this highly volatile world of stocks under $5. If you are new to these stocks, we’ve got a few articles to check out as well as a 60+ page eBook. It’s best to have the basics down before jumping right into trading
- Beginner’s Guide To Trading Penny Stocks in 2021
- Are Penny Stocks A Good Investment? 7 Principles For New Traders
- Penny Stocks & Due Diligence: Understanding Important SEC Filings
Wondering What The 10 Most Active Stocks Were On Tuesday? Here’s the list in order from highest to lowest volume:
Most Active Stocks On January 19th By Volume (NYSE/NASDAQ)
- Senseonics Holdings Inc. (NYSE: SENS)
- Inuvo Inc. (NYSE: INUV)
- AMC Entertainment (NYSE: AMC)
- Sundial Growers (NASDAQ: SNDL)
- Transenterix Inc. (NYSE: TRXC)
- Zomedica Corp. (NYSE: ZOM)
- Castor Maritime Inc. (NASDAQ: CTRM)
- Gevo Inc. (NASDAQ: GEVO)
- Bionano Genomics (NASDAQ: BNGO)
- Aclaris Therapeutics (NASDAQ: ACRS)