February 2025's Promising Penny Stocks to Watch

As the global markets navigate geopolitical tensions and consumer spending concerns, investors are turning their attention to penny stocks, seeking opportunities for growth and affordability. Despite their vintage label, penny stocks can offer a blend of affordability and growth potential when backed by strong financial health and clear growth trajectories. In this article, we will explore the top penny stocks to watch in February 2025, focusing on their chart patterns, price action history, and catalysts.

ATAI Life Sciences N.V. (ATAI)
Price: $1.50
30-day return: 17.2%
Average daily trading volume: 1,798,400
Exchange: Nasdaq
ATAI Life Sciences N.V. (ATAI) is a biotechnology company focused on advancing novel mental health treatments by leveraging psychedelic compounds and innovative drug development strategies. Following its IPO in June 2021, the company's stock hit a high of $22.91 and then toppled to a low of $1.02 in November 2023. That low was 95% below the high and established a first bottom for a multi-year sideways potential bottoming pattern. A second bottom in the pattern was established in October 2024 at $1.03. After the first bottom, the stock of ATAI saw an 18-week, 178% gain of $1.83 to a high of $2.85. From the October low, a measured move of that advance would complete at $2.86.

BTCS Inc. (BTCS)
Price: $3.09
30-day return: 24.6%
Average daily trading volume: 4,228,700
Exchange: Nasdaq
The stock of BTCS Inc. (BTCS) surged by $3.95, or 270.6%, in one week during early November, reaching a high of $5.41. A pullback followed to a swing low of $7.35. That swing low successfully tested support largely above prior swing highs and near the rising 20-week moving average. Those are signs of a strengthening uptrend. Since the low, the correction has taken the form of a potential bull flag pattern. It probably needs more time to form as each channel line has only one touch. Given the sharp rise that occurred prior to the flag forming, called the pole, there is the potential for a second sharp rally following a breakout of the flag. BTCS Inc. is a financial services company operating in the blockchain technology sector.

Compugen Ltd. (CGEN)
Price: $2.33
30-day return: 48.4%
Average daily trading volume: 694,900
Exchange: Nasdaq
Compugen Ltd. (CGEN) is a biotechnology company focused on cancer and immune-related diseases. The company's stock broke out of a bull flag pattern the week of Jan. 13 and reclaimed both the 20-week and 50-week moving averages on the breakout. Resistance was seen at a high of $2.54. That was a test of resistance at the 200-week moving average. The stock of CGEN has been trading below the 200-week moving average since July 2021. This is the first close approach since then. Given the bullish implications of the bull flag pattern, it was preceded by a sharp advance of $2.50, or 471.7%. Short-term weakness could set the stage for a continuation of the bull trend and a breakout above the 200-day moving average.

Compass Therapeutics, Inc. (CMPX)
Price: $3.11
30-day return: 108.7%
Average daily trading volume: 1,010,300
Exchange: Nasdaq
The stock of Compass Therapeutics, Inc. (CMPX) broke out of a bullish inverse head and shoulders bottom pattern in early January before reaching a high of $3.63. That high almost completed a 61.8% Fibonacci retracement of the prior downswing. Nonetheless, a retracement should lead to new short-term bullish setups, given that the bottom reversal was only recently triggered. Notice that prior to the breakout, the 20-week moving average crossed above the 50-week line, indicating a potential change in the long-term trend. Compass Therapeutics, Inc., is a biopharmaceutical company focused on oncology.

Tetra Technologies, Inc. (TTI)
Price: $4.25
30-day return: 23.6%
Average daily trading volume: 1,010,300
Exchange: New York Stock Exchange
Tetra Technologies Inc. (TTI) is an oil and gas equipment and services company. Its stock has been advancing in a rising trend channel that has stayed largely above the 200-day moving average since 2021. Recently, a bull breakout of a small inverse head and shoulders pattern triggered above $4.12. The pattern formed in a bullish position above support at the lower channel line. Other signs of strength include the 20-week moving average turning up following a reclaim of the line in early November, and the reclaim of both the 50-day and 200-day moving averages several weeks ago.



In conclusion, February 2025 presents an opportunity for investors to explore promising penny stocks with strong chart patterns, price action history, and catalysts. By keeping a close eye on these stocks and maintaining a well-defined trading plan, investors can capitalize on the potential gains offered by these affordable and growth-oriented investments.