10 Top AI Penny Stocks To Watch for April 2024

Artificial intelligence (AI) penny stocks trade below $5, and are known for their high risk and potential high reward. These stocks generally belong to smaller companies at the forefront of integrating AI into diverse products and services. For traders, these stocks present a chance to take advantage of the hottest sector right now. However, the inherent volatility and the nascent stage of these companies necessitate thorough analysis and a sharp awareness of market trends.

10 AI Stocks To Watch

My top AI stock picks for April — rated on chart pattern, price action history, and news — include the following:

The penny stocks on this list are some of the wildest movers on the market …

Trading any of these stocks should be approached with a clear strategy and an understanding of the risks involved. I don’t trade until I see a setup I like.

Jump ahead to get to my trading plans for these top AI stocks!

What is Artificial Intelligence?

Artificial intelligence is when a computer simulates human intelligence. Artificial intelligence technology seeks to create machines that can fill roles traditionally carried out by people.

There’s a wide range of things you can accomplish with AI. Recent artificial intelligence products include chatbots, self-driving cars, industrial robotic solutions, and smart assistants. While we might still be very far from truly smart robots like the Star Wars droids or the Transformers, we’re closer than we’ve ever been before.

What Are AI Penny Stocks?

AI penny stocks are shares of small artificial intelligence companies that trade at a low price, often under $5. These stocks are part of an industry that’s booming with potential, from machine learning to data analytics. Just because they’re cheap doesn’t mean they’re a sure bet. I’ve been trading and teaching for years, and I can tell you that these stocks can be as volatile as a shaken soda can.

The allure of AI penny stocks lies in their growth potential. Companies in this sector are often in the early stages of development, focusing on applications like chatbots, security, and advertising. Investors are drawn to the high-reward prospects, but it’s crucial to understand the risks involved. You’re not just investing money; you’re investing in a business’s potential to revolutionize industries.

AI isn’t the only hot sector out there. Another sector that’s making headlines is green energy. Check out these 7 green energy penny stocks that are worth watching.

Advantages of Trading AI Stocks

One of the greatest advantages of trading artificial intelligence stocks is their newsworthiness. In 2022 alone, we’ve heard of AI possibly becoming sentient, AI-generated art sold on NFT platforms like Crypto.com, and AI-assisted voice cloning.

Penny stocks are capitalizing on this buzz and getting the market’s inexhaustible supply of newbies excited about their own AI technologies — which will likely never materialize.

Since too many newbies won't study the @30DayBoot or read the @completepenny or review the 1,000+ live trading/Q&A webinars archived for https://t.co/occ8wKmlgm hopefully these charts can help you learn how EVERY penny stock pump works, it's not luck, STUDY HISTORY HAAAAAAAAAARD! pic.twitter.com/DxNUCnq08k

— Timothy Sykes (@timothysykes) March 1, 2021

As a smart trader, you don’t have to believe all the hype surrounding the artificial intelligence space. I never buy into the hype — I just trade on it.

There’s great risk in trading. A 2019 study called “Day Trading for a Living?” looked at the success rates of Brazilian traders over a 2-year window, and found that 97% of traders with more than 300 days actively trading lost money. Only 1.1% earned more than the Brazilian minimum wage ($16 per day).

I want you to watch these stocks, but only trade them with a plan. If you go for small gains and cut your losses quickly, you can do quite well.

Apply for my Trading Challenge today and learn how to trade artificial intelligence stocks!

What to Look for in an Artificial Intelligence Penny Stock

Like with any stock, the best way to prepare for artificial intelligence penny stock rallies is to build a watchlist. A good watchlist will build up your knowledge about specific stocks, as well as keep you prepared for the opportunities that may come.

Don’t take your penny stock lists from other people’s picks — not even mine. Other traders have different priorities, goals, and risk appetites. Here’s what to look for in a penny stock when building your watchlist:

Exhibits a Tradeable Pattern on its Stock Chart

Get my weekly watchlist, free

Sign up to jump start your trading education!

Send me your weekly watchlist

100% Privacy. I will never spam you!

Start with the chart.

The stocks that make my watchlists have a record of tradeable chart patterns. Check out the charts in the previous section. Penny stocks follow a boom-and-bust cycle. Since they’re mostly stocks in worthless companies that are temporarily inflated by lying promoters and gullible newbies, their patterns often repeat.

If you want to get the best read on their charts, you need a powerful trading platform on your side like StocksToTrade.

I helped design StocksToTrade. So it makes sense that it has all the features traders like me want in a trading platform.

No more navigating clunky software or hopping between multiple windows to check on the news — StocksToTrade has everything you need!

StocksToTrade has changed the way I trade. Sign up for a 14-day trial today and see how it can change your trading — it’s only $7!

Is a Low-Float Stock

Any stock with less than 10 million shares publicly available for trading is considered a low-float stock. A smaller number of shares in play means that volume spikes can really move a stock’s price.

Exhibits an Unusual Trading Volume

Stocks trading at unusual volumes are more prone to price swings, which increase your chances of safely trading “the meat of the move.” Penny stock volume is important for another reason — high volume stocks are more liquid and easier to sell.

Is a Former Runner

A penny stock that’s run in the past has a better chance of running again in the future. Why?

• It’s shown that it can run in reaction to the catalyst that made it run the first time
• The market has a memory
• Promoters also have a memory, and they’ll keep on pumping a hot stock until the worthless company it’s associated with goes out of business

Gets Frequent Media Attention

Breaking news stories and press releases about new technology solutions often lead to major price swings in tech penny stocks. Like we’ve already established, AI is a sector that gets a lot of news coverage.

Where to Buy AI Penny Stocks

You can buy AI penny stocks on major exchanges like the New York Stock Exchange (NYSE) and Nasdaq, as well as in the over-the-counter (OTC) markets. Most people trade penny stocks through broker websites and apps like Robinhood, Chase, and Wealthsimple Trade.

NYSE/Nasdaq Penny Stocks

You can find AI penny stocks among the tech giants listed on major exchanges like NYSE and Nasdaq. Listed stocks are more regulated than OTC stocks, and are generally perceived as more stable companies.

Most of the hot AI stocks are found on the Nasdaq. These stocks are generally more regulated and can offer a different kind of stability in the volatile world of penny stocks. Learn more about penny stocks on Nasdaq here.

OTC Penny Stocks

OTC or unlisted penny stocks fall into one of three tiers:

• Pink sheet
• OTCQB
• OTCQX

Each OTC tier has different regulations and requirements. Pink sheets have little in the way of regulation, while OTCQX is more strictly regulated. That isn’t to say I won’t trade a pink sheet stock — I just won’t trust it.

Some AI stocks with the biggest potential for quick gains are found on the pink sheets. Of these, stocks under 10 cents are a distinct breed. These ultra-cheap stocks can be even more volatile, offering both higher risks and potentially higher rewards. If you’re looking to add some spice to your trading strategy, consider these options. Here’s a guide to penny stocks under 10 cents.

The Best Place to Buy Tech Penny Stocks

Are listed stocks better than unlisted, or vice versa? It depends on your risk appetite.

I trade both listed and unlisted stocks. I don’t see why I should limit myself.

10 Best AI Stocks for April 2024

My top AI penny stock picks are:

• NASDAQ: SOUN — SoundHound AI Inc — The Former Runner With NVIDIA News
• NYSE: BBAI — BigBear.ai Holdings Inc — The Analyst Upgrade AI Penny Stock Spiker
• NASDAQ: AUUD — Auddia Inc — The Reverse Split AI Audio Stock
• NASDAQ: RVSN — Rail Vision Ltd — The Big AI Spiker With the Little Bounce
• NASDAQ: AISP — Airship AI Holdings Inc — The AI Stock With a Government Contract
• NASDAQ: MRAI — Marpai Inc — The AI Penny Stock That Insiders Are Buying
• NASDAQ: HOLO — MicroCloud Hologram Inc — The Meme Stock With an AI Pump in its Past
• NASDAQ: PHUN — Phunware Inc — The AI-Enabled Mobile Engagement Stock With a Trump Catalyst
• NYSE: PLTR — Palantir Technologies Inc — The AI Stock Leader That’s Gaining on Results
• NASDAQ: SMCI — Super Micro Computer Inc — The Mega-Cap Stock That’s Moving Like a Penny Stock

Before you send in your orders, take note: I have NO plans to trade these stocks unless they fit my preferred setups. This is only a watchlist.

The best traders watch more than they trade. That’s what I’m trying to model here. Pay attention to the work that goes in, not the picks that come out.

Sign up for my NO-COST weekly watchlist to get my latest picks!

Here’s some background info on the AI sector:

• What is the most promising AI stock?

A sector leader like NVIDIA Corp (NASDAQ: NVDA) is the best bet for the most promising AI stock. But remember, we’re traders, not investors. So the stocks on this list are ones we’re watching for short-term moves, not predictions of which will lead stock exchanges in 2030.

• What are the top 3 AI stocks to buy now?

My top 3 AI stocks to buy now (as long as their price action is strong) are SoundHound AI Inc (NASDAQ: SOUN), Palantir Technologies Inc (NYSE: PLTR), and Marpai Inc (NASDAQ: MRAI).

• Which company is most advanced in AI?

NVIDIA is the most advanced publicly traded company in AI, that’s why it’s the sector leader. But other leading tech stocks like Apple, Microsoft, Google, and Facebook are all safe bets to pull ahead at some point.

• Which Artificial Intelligence stocks have a “Strong Buy” analyst rating?

Analysts tend to love these tech leaders — NVIDIA, Microsoft, Google, and Facebook. Most analysts have rated all of these stocks as “strong buys.”

Let’s get to the picks …

1. SoundHound AI Inc (NASDAQ: SOUN) — The Former Runner With NVIDIA News

My first AI penny stock pick is SoundHound AI Inc (NASDAQ: SOUN).

This company works in “conversational intelligence.” Essentially its services help business people communicate if there are language barriers.

And when the AI boom began in 2023, SOUN was one of the first runners. Always remember: Past spikers can spike again.

In 2023 the price spiked 410%. But it sank from those highs in 2024. A lot of trashy penny stocks can spike hundreds of percentage points. But they ultimately crash back down.

It’s possible for the price to rally and push to new all-time highs. But it takes a BIG catalyst and BIG volume to push through all the bagholders.

Why I Like It

On February 15 it was announced that NVIDIA Corporation (NASDAQ: NVDA) bought a stake in SOUN.

NVDA is the star of the U.S. stock market this year. The company’s microchips are at the center of this AI and tech boom.

As a result, SOUN prices spiked 250% since the February 15 announcement. It shot past 2023 highs on February 26 and put in highs close to $8. That’s the new breakout level.

Prices dipped to support at $5 in early March. And right now it’s rallying toward the $8 level. Below is a chart where every candles represents one trading day:

Keep an eye on this former AI spiker eyeing new highs.

2. BigBear.ai Holdings Inc (NYSE: BBAI) — The Analyst Upgrade AI Penny Stock Spiker

My second AI penny stock pick is BigBear.ai Holdings Inc (NYSE: BBAI).

I traded this stock during the height of its spike on March 4.

The company successfully completed an acquisition of Pangiam, a tech-security company.

My trade notes are below, notice I didn’t overstay my welcome. BBAI face planted a few days after my trade.

These penny stocks are sketchy, but those who are wise to the price action can pull profits.

Here’s my latest very small, very conservative win (off a starting stake of $29,455):

Why I Like It

I’m trading short term volatility.

BBAI might not break past the highs. But it’s still an AI penny stock during a red-hot 2024 tech market.

And since the drastic selloff, there are a lot of analysts exploring possible dip buy opportunities.

Don’t get married to this stock. But if you see an opportunity for a quick profit … It’s well worth the time to plan a trade.

3. Auddia Inc (NASDAQ: AUUD) — The Reverse Split AI Audio Stock

My third AI penny stock pick is Auddia Inc (NASDAQ: AUUD).

Sketchy penny stocks hold reverse splits in an effort to prop up the share price.

The share supply is cut, thereby making every remaining share more valuable. Penny stocks usually have to inflate their prices to meet exchange listing requirements.

One of the requirements a company must follow to remain on the Nasdaq exchange is a share price above $1.

On February 23, AUUD announced a 1-for-25 reverse split set for February 27.

Prices are currently above the $1 minimum … but not by much.

Why I Like It

This stock has already shown us that it will take action to inflate its share price.

Sketchy? Yes.

Profitable? If you’re prepared.

And since the company’s reverse split, the supply of shares is well below our goal of 10 million shares or fewer. StocksToTrade shows that AUUD has a float of only 719k shares.

We like stocks with a low supply of shares because it helps the price spike higher when demand increases.

AUUD is a ticking time bomb. Get ready for a sketchy catalyst to spike the price.

4. Rail Vision Ltd (NASDAQ: RVSN) — The Big AI Spiker With the Little Bounce

My fourth AI penny stock pick is Rail Vision Ltd (NASDAQ: RVSN).

Past spikers can spike again …

RVSN has already launched 1,500% in 2024. Take a look:

Why I Like It

RVSN spiked 140% on March 6 after it announced a “groundbreaking” AI safety system during premarket.

There’s a chart below. From left to right the shaded columns show after hours, premarket, regular hours, and after hours again. So on and so forth.

The candles each represent 15 minutes:

I snagged an 18% profit from the March 6 spike, off a starting stake of $8,256:

Pay attention to volatile stocks that show consolidation!

The chart above shows consolidation around $2.50. It hasn’t broken below that level significantly. And that’s a hint the price could surge higher.

5. Airship AI Holdings Inc (NASDAQ: AISP) — The AI Stock With a Government Contract

My fifth AI penny stock pick is Airship AI Holdings Inc (NASDAQ: AISP).

Anyone who thinks penny stock volatility is a random phenomenon probably has no experience trading these runners.

Next time someone brings it up, push the subject a little further. Maybe they got burned badly on a penny stock and now they’re forever jaded.

It’s sad, because there are real opportunities to profit in this market.

Some people ignore all of it due to a bruised ego from a few years ago. Don’t fall for the same fate — go for singles, and cut your losses quickly!

Why I Like It

It started as an AI penny stock. But the spike recently crossed $10.

Remember, these runners usually end up right back where they started. Don’t hold shares of AISP. That’s not a strategy.

We’re focused on likely trade patterns based on the stock’s price action.

On March 5 at 8:31 A.M. Eastern, the company announced a new government contract with the U.S. Department of Justice. Government news is HUGE for a penny stock.

People say penny stock volatility is random … but look at how quickly the price reacted after AISP announced news. It spiked and set resistance at $9, consolidated, and then broke higher …

The chart is below:

Trading tip: Resistance can become support and vice versa.

The price recently dipped below $9 support.

It’s possible the recent breakout above $9 is a failure. That happens from time to time.

But there’s still an opportunity to profit on the way down.

Look at the #5 and #6 patterns from my penny stock framework.

This volatility is NOT random. Study the overall framework and you’ll start to notice these patterns in the market.

6. Marpai Inc (NASDAQ: MRAI) — The AI Penny Stock That Insiders Are Buying

My sixth AI penny stock pick is Marpai Inc (NASDAQ: MRAI).

There’s a lot going on here …

Why I Like It

Let’s run down the list:

• It’s an AI stock in the healthcare industry.
  • Almost a combination of AI and biotech: These are the two hottest sectors of the year right now.
• StocksToTrade shows the float is only 4.7 million shares.
  • A low share supply adds to the massive spike potential.
• It spiked 290% in April 2023.
  • Past spikers can spike again.
• It’s approaching highs set by the 830% spike in November 2023.
  • A break of those highs would be HUGE.
• It was just granted an extension to regain Nasdaq compliance.
  • One of the requirements is a market value of at least $35 million. MRAI only has a value of $20 million. Which means the company is incentivised to pump the stock value. The extension is until May 28.
• There are insiders actively buying shares of this stock. That’s a bullish sign.
  • In an SEC filing I found that Damien Lamendola bought 910k shares of MRAI on March 7 using one of his other companies, WellEnterprises USA LLC. Lamendola was named CEO of MRAI on November 6, 2023. And thus … insider buying.

Bada boom.

Take a look at the chart, each candle represents one day:

Plan your trade carefully.

Use support and resistance to build a position.

Follow the rules to trade ‘safer’…

7. MicroCloud Hologram Inc (NASDAQ: HOLO) — The Meme Stock With an AI Pump in its Past

My seventh AI penny stock pick is MicroCloud Hologram Inc (NASDAQ: HOLO).

This is one of the most legendary short squeezes of 2024.

I’ve already written multiple blog posts about this stock and filmed a handful of videos tracking the price action …

Like the one below:

And since past spikers can spike again …

Why I Like It

There were HOLO spikes in January and August 2023 as well — 610% and 350% respectively

Unlike the 2024 short squeeze, the spikes in 2023 had roots in the AI industry.

But 2024 has been a year of insane spikes.

Forget the 610% and 350% 2023 spikes …

In February 2024, HOLO launched 6,400%. It went from less than $2 to $98.

Here’s a chart of all the moves since 2023. Each candle represents one trading day:

I don’t expect HOLO to run back to $98. That’s an unrealistic prediction. And besides, I don’t predict price action.

Instead, I react to it.

HOLO started moving again in March. That momentum could continue into April.

Be prepared.

8. Phunware Inc (NASDAQ: PHUN) — The AI-Enabled Mobile Engagement Stock With a Trump Catalyst

My eighth AI penny stock pick is Phunware Inc (NASDAQ: PHUN).

This stock is connected to Donald Trump. The company helped him run for president during 2020 … When he lost.

We don’t get political here …

But some political events influence trading opportunities.

Why I Like It

When Trump does well in the polls, PHUN has a history of spiking. As does the other Trump stock: Digital World Acquisition Corp. (NASDAQ: DWAC).

When Trump won the Iowa caucus on January 16, PHUN launched 580%. Take a look below:

As the U.S. election year heats up, we can expect more volatility from these Trump stocks.

And it helps that PHUN has ties to AI as a software business. The company works to boost mobile engagement for clients.

Don’t build a random position on this runner. Wait for the volatility to come black, then plan a trade around key support and resistance.

Don’t get married to PHUN … it’s still a crappy penny stock. Just play the hype.

9. Palantir Technologies Inc (NYSE: PLTR) — The AI Stock Leader That’s Gaining on Results

My ninth AI penny stock pick is Palantir Technologies Inc (NYSE: PLTR).

This company works in the tech-defense sector.

There’s a growing concern about AI’s utilization by scammers, criminals, and enemies of the state to disrupt and prey on society at large.

Just look at this headline!

As a result, companies like PLTR are increasing the strength of their services to combat this growing risk.

That’s what makes this niche so essential in the AI industry.

Why I Like It

The company announced in November of 2023 that it secured 80 new deals in the third quarter of that year.  Each deal was valued at $1 million or more.

The price spiked up to $22 within the month. That was the breakout level.

On February 5 an earnings report came out while the market was closed. The next day, prices gapped up 20% and continued the spike to an impressive 50% in the following days.

PLTR reacts well to bullish news.

Wait for the next hot catalyst to move the stock.

10. Super Micro Computer Inc (NASDAQ: SMCI) — The Mega-Cap Stock That’s Moving Like a Penny Stock

My tenth AI penny stock pick is Super Micro Computer Inc (NASDAQ: SMCI).

Small-account traders like low-priced stocks because:

• We can load up on shares.
• The low price helps the stock spike higher from a percentage perspective.

Higher priced stocks aren’t known to surge day to day.

But the AI sector is hot in 2024, we’re seeing some INSANE moves from big stocks.

SMCI is one of the biggest names in AI. And so far in 2024, prices spiked 340% despite starting the year above $250 per share. There’s a StocksToTrade chart below that shows the multi-day move (left) and intraday moves (right):

Why I Like It

I’m not likely to trade a mega-cap stock like this.

But it helps to illustrate the strength of the overall sector. 

And when large-cap stocks behave like volatile penny stocks, it’s possible to trade them for a lower cost using options.

At the mention of “options” a lot of traders shy away …

It’s not as confusing as you think.

Ben Sturgill is a successful options trader with verified profits and a tested strategy. Like me!

I don’t associate myself with shady traders.

His Spyder webinars are the product of more than 2 decades of experience in the market and a unique technology, and they’re well worth checking out.

Check out the webinar here to see why Ben’s smart-money scanner has been going haywire lately!

AI Stocks Under $5

The allure of hot sector stocks, especially when they’re also penny stocks, is undeniable. These stocks present a unique blend of opportunity and volatility. The AI industry is booming, with advancements and applications spreading across various sectors, from healthcare to finance, making AI stocks a magnet for investors looking for the next big thing. The gains here can be proportionately greater than those from more established stocks, mainly because even minor positive news or advancements can send their prices soaring.

However, it’s crucial to approach these opportunities with a clear strategy and an understanding of the risks involved. The volatility of penny stocks, combined with the speculative nature of AI ventures, means that while the potential for rapid gains is significant, the risk of losses is equally high. Conduct thorough research, looking beyond the hype. And never invest in these stocks — only trade them.

Remember, the key to success in trading AI stocks under $5 is not just about jumping on every opportunity but being selective and strategic. It’s about leveraging the explosive potential of the AI sector while managing risk meticulously. By focusing on companies with the potential to lead in their niche, traders can capitalize on the disproportionate gains that these penny stocks offer, all while keeping their investment strategy tight and cutting losses quickly.

Key Takeaways

Trading in AI penny stocks presents potential for profit, yet it’s crucial to keep an awareness of the risks involved. As traders, our approach isn’t about blindly pouring money into AI stocks. Instead, we focus on trading based on discernible patterns and deep market insights.

In trading, the small gains accumulate over time. Don’t get swept away by the AI buzz; stay grounded in hard facts and observable market patterns. That’s the essence of trading AI penny stocks.

Key Considerations:

• A lot of penny stocks are shady. Risk in AI penny stocks can be heightened due to limited company information and unsavory promotion.
• There’s a possibility for big gains. With the AI sector’s potential for rapid advancement, these stocks can go supernova at any time.
• The sector is young. AI penny stocks are impacted by technological innovations and developments, which can dramatically shift their market trajectory and valuation.

Artificial intelligence is one of the hottest sectors in trading, thanks to it being one of the hottest sectors in the popular imagination. The frequency of breaking news means there are bound to be opportunities for good trades.

Just because there are opportunities for trades doesn’t mean you will necessarily catch them. You have to be prepared. That means keeping a good watchlist, watching the market, and studying harder than all of the other traders trying to come out on top.

What are the AI penny stocks on YOUR watchlist? Let me know in the comments!

Frequently Asked Questions

How Should You Value AI Companies?

Valuing AI companies is a complex task that involves a deep dive into their financials, growth prospects, and market demand. Traditional metrics like earnings and revenue are important, but you also need to consider factors like data acquisition capabilities and the quality of their machine learning algorithms. From my experience, understanding the nuances of an AI company’s value can make or break your portfolio.

What AI Company Is Elon Musk Investing In?

Elon Musk recently launched xAI, billed as a ChatGPT alternative. Musk was a founding board member and investor in OpenAI, the company behind ChatGPT. He stepped away due to potential conflicts with Tesla’s AI development for self-driving cars.

How Do You Invest in the AI Industry?

Investing in the AI industry requires a well-thought-out strategy. You need to diversify your investments across various sectors like analytics, machine learning, and data security. You can use a mix of financial instruments like securities, equities, and even some options to balance out the risks and potential rewards.

What Information Can I Find in AI Articles?

By reading widely, you’ll find valuable information and insights related to artificial intelligence businesses and their customers. They often have content that contains various links to research and services, aimed to help you better understand this market.

What Determines the Market Cap of AI Penny Stocks?

The market cap of AI penny stocks is determined by a variety of factors including their momentum and results in the market. Monitoring these can give you an idea of their potential for profit.

How Can Services and Research Aid My Investment?

Services provide tools and platforms that can assist you in making informed decisions. The research, on the other hand, provides deeper insights into market trends, business models, and potential for profit, for stocks ranging from powerhouses like Tesla (TSLA), NVIDIA (NVDA), and Microsoft (MSFT) to penny stocks like AMST, POAI, and PBTS.