How to Find the Best Penny Stocks to Trade? - Using descriptive indicators

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Technical Analysis 101
Sun, May 28, 2023, 9:26 PM ET  ·  2 min read  ·  0 view

There are hundreds of penny stocks listed on the exchanges, but have you ever had this question: which group of penny stocks should I trade? This article is here to help you find the best penny stocks for you to trade or at least add to your watchlist using descriptive indicators.

Unusual Volume

 

To begin with, it is important to find stocks that have higher-than-normal trading volume. By doing so, you can track the flow of money and identify unusual events that could potentially act as a catalyst for the stock. In some cases, penny stocks may show up on a scan for high volume even if the company itself hasn't released any news. This could be due to industry-related news or events.

 

For example, when cannabis was legalized in Canada, many marijuana penny stocks experienced significant growth. This was not necessarily due to any individual company news, but rather the overall response to the major industry news. In some cases, screening for unusual or high-volume penny stocks can help investors identify trends before they become widely recognized.

 

In order to find penny stocks with unusual volume, you can type in the query below using AInvest:

Unusual volume; Price < 5

 

By using these methods, investors can potentially gain insight into the movements of penny stocks and make more informed trading decisions. It is important to keep in mind that penny stocks are highly volatile and can be subject to manipulation, so it is important to do thorough research and exercise caution before investing.

 

New High & New Low

New highs and new lows are significant for penny stocks because they can indicate a potential shift in the stock's price movement. When a penny stock reaches a new high, it means that the stock has never traded at that price before, and investors may interpret this as a sign of bullish momentum. Conversely, when a penny stock hits a new low, it means that the stock has never traded at that price before, and investors may interpret this as a sign of bearish momentum.

 

Monitoring new highs and new lows can be particularly important for penny stocks because they tend to be more volatile and have lower liquidity than larger, more established stocks. This means that sudden and significant changes in the price of a penny stock can happen with little warning. By keeping an eye on new highs and new lows, investors can potentially identify stocks that are experiencing a significant price movement and make trading decisions accordingly.

 

In order to find penny stocks making new high, you can type in the query below using AInvest:

Intraday high = 52 week high; Price < 5;

 

You can also type in the query below to find penny stocks making new low using AInvest:

Intraday low = 52 week low; Price < 5;     

 

However, it's important to keep in mind that hitting a new high or new low doesn't necessarily indicate a guaranteed trend in the stock's price movement. Penny stocks can be influenced by various factors, such as industry news and market sentiment, and can be subject to manipulation. Therefore, investors should exercise caution and do their own research before investing in any stock, regardless of whether it has hit a new high or new low.

High Volume Penny Stocks


For those trading penny stocks, volume is crucial. The reason you want volume is to enter and exit trades easily and at optimal prices. If penny stocks don’t usually trade, it can be difficult to buy at the price you want or sell at the price you want. It’s also good to look for higher than average volume because it could mean there’s growing interest in the penny stock and likely something that could compound over a certain timeframe.

 

In order to find high volume penny stocks, you can type in the query below using AInvest:

Last 22 day average traading volume > 10m; Price < 5

 

There are other ways to find penny stocks to trade. For example, using technical indicators can be a significant method when trading penny stocks. If you also interested in finding penny stocks using technical indicators, click the link here to learn about the function.


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