Trading penny stocks can be a very rewarding or painful experience. We’ve found 6 hot penny stocks that may show a promise of rapid growth. Always remember penny stocks are illiquid markets. Entering and exiting your investments in these stocks may not always be as timely and easy as blue chip or mid-cap stocks.
The way I like to consider these investments is as a call option on the stock. These shares are priced from a few pennies to less than 2 dollars. That is pretty similar to the premium you would pay on stock options.
So, identifying a company that has strong growth potential and entering a buy-and-hold investment is similar to buying a call option on the stock. If the stock price rises, you cash in on your profits. If the stock falls, well at worse you simply lose the cost of the option.
Here are our picks for hot penny stocks traded on an exchange. The advantage of trading penny stock on an exchange is the transparency offered in pricing. There is also more publicly available information.
Aeglea was founded in 2013 and is headquartered in Austin, Texas. AGLE is a clinical-stage biotechnology company that develops and designs human enzyme therapeutics. These treatments are designed for patients and families with rare metabolic diseases.
The company has three main products in the pipeline. Their leading product is designed to combat Arginase 1 deficiency. The drug is in Phase III PAECE trials to determine its safety and efficacy. They also have another product AGLE-177 for the treatment of homocystinuria, which is in Phase I/II of clinical trials. The company is also investigating a drug for cystinuria which is in preclinical trials.
This stock is up 78.67% over the past 5 days of trading. On August 19, 2022, it reached a recent high at $1.02 but failed to remain above the $1 psychological barrier. On the 4-hour candle chart, we can see that price action has broken through the Ichimoku cloud. And the MACD is showing bullish momentum with the leading line well above zero.
Both the Ichimoku system and the MACD indicate a potential continuation of a bullish trend. However, on the day chart, the price action failed to break the Ichimoku cloud and the MACD line is not above zero, as of writing.
For a continuation of a medium-term bull trend to be confirmed, price action would need to break through the Ichimoku cloud and the MACD line would have to rise above the zero line. However, the 4-hour chart may show what is to come next if the stock price can rise above $1.044.
Lottery.com runs a technology business in the B2C field. It manages a platform that allows users to buy legally sanctioned lottery tickets in the United States and globally. They also operate an affiliate program under the LotteryLink brand.
This part of the business has led to considerable revenue growth in Q1 2022. The company saw revenue of $21.2 million for Q1 2022, up by $15.7 million for the same period in 2021. LTRY also delivers lottery data, such as winning numbers and prizes to around 400 publishers and organizations.
The main factor that caught our attention with this penny stock is the trading volume from Friday 19, 2022. The stock has an average daily trading volume of around 2.2 million shares. Yet Friday’s trading volume was a whopping 78.68 million shares.
So, the question arises is there something that only some people know? Or is this a technical rebound after LTRY lost 92.52% YTD? Hard to answer that question, but this stock is certainly worth watching.
From a technical point of view, the charts show an ongoing bear trend. Price action attempted to break out of the rectangle which started the formation at the beginning of August. However, that seems to have failed.
On the 4-hour chart price action met with resistance from the bottom of the Ichimoku cloud. While the MACD leading line is still below Zero. And on the day chart, the bear trend is still intact. So, it remains to be seen over the next few days if bulls can drive this stock higher on the back of the enormous one-day trading volume.
Regis Corporation is a leader in the hairstyle industry. The company runs, owns, and franchises hair salons in the United States, United Kingdom, Canada, and Puerto Rico. The company runs, franchises, or participates in ownership of 5,697 salons worldwide.
The hair salon company runs its business under several names, including Supercuts, Roosters, and Cost Cutters. The salons offer various hair styling services and beauty and cosmetic products. Regis Corporation successfully renegotiated its debt on August 15, 2022.
On August 22, the company announced they had hired Michelle DeVore as head of marketing. Their new head of marketing brings a wealth of experience from the marketing industry in various beauty and cosmetic products firms.
As of writing, RGS is up 56% over the past 5 days of trading. The trading day on August 15 saw a big jump in price as the market saw the company’s debt renegotiations favorably. The share price opened at $0.97, a jump of $0.34 from the previous close, and rose to a high of $1.34.
From the day chart, we can see that price action has broken well above the Ichimoku cloud, with the lagging line confirming the break. The 4-hour chart also confirms the short-term trend with the share price above the cloud.
The MACD leading line is well above zero. Very noticeable is the surge in volume on Friday 19, 2022 when the debt renegotiation was announced. Volume on the day was up at 22.6 million shares, compared to a daily average volume of 1.9 million.
Moving iMage Technologies was founded in 2003, and is based in Fountain Valley, California. The company designs, manufactures, and distributes a whole array of cinema theatre products. MITQ has customers nationwide and across the globe.
Its products and services include equipment integration, modernization, and building of cinema theatres. The company also provides digital cinema applications, rack mount pedal, aisle lighting, and arm and cup rests to mention a few from the full repertoire.
Price action on this stock has been very choppy since March 2022. With large swings north and south as the stock price traded range-bound within a volatile environment. However, Friday 19, 2022, saw this stock’s price move above the Ichimoku cloud on the day chart for the first time since it started quoting on the NYSE.
This stock is up 24.58% over the past month, and last Friday’s close at $1.48 consolidated 4 days of trading above the cloud. Having said that, as we can see from the day chart, price action has still not cleared the trading range that goes back to March.
For further consolidation of a bull trend, we would need to see the price go above $1.59. A close above that level may indicate price action has finally broken above the upper range limit. Notice that this stock has tried to break the resistance of the Ichimoku cloud twice this year.
The first attempt was on April 22, with a staggering 91.43 million shares exchanged. However, the price subsequently declined to the recent low of $0.82. The second attempt was the end of the rally that started after that low and saw the price reach a temporary high at $1.66.
This would be the third attempt and it seems like it may be the one that breaks the ongoing bear trend. We can expect some retracement from here as many traders are likely to take their profits. However, if the price stays above the cloud and the MACD stays bullish we could get a further rally in this penny stock.
Over-the-counter (OTC) stocks suffer from a lack of transparency from the company and the actual pricing of trades. There is also less publicly available information. So, these stocks are considered riskier than stocks traded on an exchange.
However, the fact that they are usually less liquid can also lead to bigger price swings. As these stocks tend to have smaller trading volumes it means there are not so many people watching these stocks.
Philux Group was founded in 1982, under the name of PHI Group Inc. The company changed its corporate name to the present one in August 2022. Philux Group is an M&A advisory, consulting, project finance, and capital markets company.
The company is based in Houston, Texas, but has offices in South America, Africa, Europe, and Asia. Philux Global also has sub-funds that focus on investments in real estate, infrastructure, agriculture, and renewable energy.
On Friday 19, the company announced that it was buying a majority stake in Tin Thanh Group. But more importantly, it had secured a $3 billion equity investment commitment from a gulf corporation council group.
Price action on this stock had been limited to a tight range since April 26, 2022. With all the peaks and troughs between a low of $0.005 and a high of $0.001. Friday 19, saw this stock’s price surge to a recent high of $0.002.
And more importantly, the rally was accompanied by a large daily trading volume of 2.1 billion shares, approximately 5 times the daily trading volume average. Also, this sharp rally lifts the price above the Ichimoku cloud for the first time since June 2021.
As you can imagine, due to the small price tag per share, this stock is up 225% over the past 5 days. However, the bull run was on the back of a very high volume, plus the Ichimoku system and the MACD indicator are now both bullish.
Brookmount Explorations is a gold mining and exploration company. It focuses on acquiring high-quality projects in different locations for diversification. The company currently has two projects in Indonesia and one in Canada.
Brookmount shares are up 133.95% over the past 5 trading days and are up 98.28% YTD. The breakout of the bull trend happened on August 15, 2022. The price of this stock traded and closed above the Ichimoku cloud, with confirmation from the lagging line and the MACD indicator.
The two technical indicators show a bullish momentum in action. And the sharp increase in trading volume leading up to the rally and beyond would indicate a new bull trend is in place for the medium term.
However, some caution may be needed, the price has gone from $0.0269 on August 1 to its current level at the time of writing at $0.403. That’s 1,398% in 16 trading sessions. So, a correction may be on the horizon, although this stock looks very bullish technically.
Picking penny stocks is a very tricky business picking the hot penny stocks to buy is even trickier. However, the list of penny stocks that we went through all seem to have big upside potential. And investing in penny stocks can be considered in a way similar to buying a call option.
In any case, we always advise you to speak to your financial advisor before committing any of your cash to highly speculative investments. Also, if you are going to actively trade stocks, you may want the help of some experts.
Many companies out there offer their stock picking services. However, here at StockTradingTeacher we have weeded out the unworthy and created a list of reputable and reliable companies. You can read our reviews on the top stock picking services here.
Gino D’Alessio is a Broker/Dealer with over twenty years experience in various OTC markets such as Bonds, FX and Derivatives. Currently a Financial Markets and Investments Writer & Analyst