Penny stocks refer to stocks which trade at $5 per share or less. Their market cap is usually micro — under $300 million in total stock equity.
That’s the official definition at least. In spirit, these low-priced stocks are volatile and sketchy. They sell hope like other companies sell products. Despite it all, penny stocks are still the best way to build a small account quickly.
Table of Contents
- 1 3 Penny Stocks to Watch in February 2024
- 2 Top 3 Penny Stocks to Watch for February 2024
- 3 Best Penny Stocks for February 2024
- 4 How to Use This Penny Stocks Watch List
- 5 Can You Trade Penny Stocks?
- 6 What Are the Advantages of Investing in Penny Stocks?
- 7 Potential Risks of Investing in Penny Stocks
- 8 5 Tips on How to Choose the Best Penny Stocks to Watch
- 9 If Most Penny Stock Companies Fail, Why Not Just Short Sell?
- 10 How Much Money Do I Need to Get Started?
- 11 Join My Trading Challenge Today
- 12 Conclusion
- 13 FAQs
- 13.1 What Are Penny Stocks?
- 13.2 Are Penny Stocks Worth It?
- 13.3 Are Penny Stocks Dangerous?
- 13.4 How Do You Watch Penny Stocks?
- 13.5 Can You Become a Millionaire from Penny Stocks?
- 13.6 How Often Do Penny Stocks Go Big?
- 13.7 What Have Been the Most Successful Penny Stocks?
- 13.8 What Do Analysts Say About Penny Stocks?
- 13.9 What Markets Are Most Common for Penny Stocks?
- 13.10 How Can I Stay Updated on Penny Stocks?
3 Penny Stocks to Watch in February 2024
My top stock picks for February — rated on chart pattern, price action history, and catalyst — include the following:
|NeuroBo Pharmaceuticals Inc
|Mira Pharmaceuticals Inc
|Gorilla Technology Group Inc
You can see how the plan with penny stocks is rarely buy-and-hold …
Those performance numbers are just through the first week of February!
Trading these penny stocks should be approached with a clear strategy and an understanding of the risks involved.
Jump ahead to get to my trading plans for these top penny stocks!
Top 3 Penny Stocks to Watch for February 2024
My top 3 penny stocks to watch for February are:
- NASDAQ: NRBO — Neurobo Pharmaceuticals Inc — The FDA Approval Biotech Penny Stock
- NASDAQ: MIRA — Mira Pharmaceuticals Inc — The Psychedelic Treatment Biotech Penny Stock
- NASDAQ: GRRR — Gorilla Technology Group Inc — The AI Earnings Winner Penny Stock
Has someone ever told you, “Penny stocks are a scam. You might as well throw your money down the toilet” !
From my perspective, that sounds like someone who lost money in a sketchy stock once and swore to never trade again.
I don’t blame them for feeling jaded.
There are a lot of sketchy aspects of my niche.
But here’s the catch …
If you know where the traps are, you can avoid them.
I know these are sketchy stocks. And I’m able to trade them for a profit — $7.5 million and counting — because of that knowledge.
Yes, people have also encouraged me to trade more trusted stocks.
But the blue chips don’t spike hundreds of percentage points in a single day …
And that volatility is kind of hard to ignore.
Here’s what’s at the top of my scan right now …
Best Penny Stocks for February 2024
These are the top 3 penny stocks I’m watching in February 2024 …
No, that doesn’t mean that I’ll trade them. Learn the patterns that work best for you — you might have a chance to use them with these stocks!
#1: Neurobo Pharmaceuticals Inc (NASDAQ: NRBO) — The FDA Approval Biotech Penny Stock
My first penny stock pick is Neurobo Pharmaceuticals Inc (NASDAQ: NRBO).
One of the hottest sectors right now are biotech penny stocks.
We saw year-long spikes in 2023 and the momentum is continuing into 2024.
This is very important: We’re not holding shares of the same volatile stocks all year.
Every week there’s a new spiker. I wait with my account in cash until I see a perfect setup…
Like the NRBO spike on February 1.
The biotech company announced FDA approval of its phase-1 trial for an obesity drug.
Obesity drugs are a curiously common catalyst in the market right now. Here’s another example:
Notice how quickly the price jumps after the news hits the market:
This is not meaningless volatility. When crappy stocks announce hyped-up news, the price can spike hundreds of percentage points. And we can track that momentum.
On the chart above, the spike measured 100% in premarket.
My trades are listed below:
There are still opportunities to profit on this stock.
Prices haven’t returned to pre-spike levels. Instead, the chart is consolidating sideways.
When the market’s most volatile stocks start to consolidate, it’s a hint that the price could push to new highs. Keep an eye on this chart.
If it breaks out, you’ll be ready.
#2: Mira Pharmaceuticals Inc (NASDAQ: MIRA) — The Psychedelic Treatment Biotech Penny Stock
My second penny stock pick is Mira Pharmaceuticals Inc (NASDAQ: MIRA).
Surprise surprise, it’s another biotech stock.
This is a huge former spiker from November 2023.
Past spikers can spike again.
It’s one of the factors that I look for when I plan a trade.
In November, MIRA announced a new license agreement for a Ketamine treatment. In case you hadn’t heard, Ketamine was first developed as an anesthetic in 1962. But more recently it’s recognized as a possible treatment for depression.
The stock spiked 380% within the month.
Fast forward to February 5, the stock announced a collaboration with Pharmaseed to conduct pre-clinical ketamine studies.
I snagged some profits early on. But the price could push even higher.
MIRA barely moved on February 5 compared to November 2023. It only spiked 60% that day. And the news is really similar.
If the price can consolidate above a key support level we could see it breakout in the near term.
#3: Gorilla Technology Group Inc (NASDAQ: GRRR) — The AI Earnings Winner Penny Stock
My third penny stock pick is Gorilla Technology Group Inc (NASDAQ: GRRR).
This is another former spiker. I traded it back in July of 2023.
The spikes don’t last forever. But we often see the same stocks spike over and over again.
I traded it again on February 5, the AI company announced bullish earnings for the third quarter of 2023. Here are some of the key points:
- Q3 revenues exceeded total revenue of 2022
- High value Product driven & Services business model reflected in 76.5% gross margin
- Won sales exceeded internal target of $68 million, standing at $300 million (a 441% increase)
I snagged a small profit before the price pushed higher.
The price is consolidating above $1 right now. That’s a key support level to watch. It’s possible the stock rallies off of that level.
Plan your entry and exit carefully. It’s possible to lose money even on the most bullish runners.
We follow the market’s most profitable patterns to mitigate that risk.
There’s a process for profits in this niche. Follow the rules and your account will stay safe.
How to Use This Penny Stocks Watch List
My watchlists aren’t rocket science. They’re a product of paying attention to what’s already happened.
The stocks on this list are former runners with recent news. That means I’m not the only one paying attention to them.
You should use this list as a model for your own watchlists.
Don’t just copy the stocks on this list. Learn my selection process and create your own.
Can You Trade Penny Stocks?
Penny stocks get a bad rap, especially from Wall Street types.
Sure, 99% of them are crap. Some are even outright scams aiming to take money from their stock customers.
But where else can you earn 15-30% profits on a single day trade?
Penny stocks are only bad if you start to believe the hype. Take Ocean Biomedical (NASDAQ: OCEA), a biotech penny stock that’s had some early 2023 spikes on positive news for its cancer treatment candidate.
It’s got an awesome story to sell. And — just maybe — they’ll become the maker of a front-line cancer treatment.
But you know who I’d bet on instead? Eli Lilly and Co. (NYSE: LLY), a $300-billion company with several FDA-approved cancer treatments already on the market.
They’ve got a $7 billion R&D budget. So yes, they’ll probably beat OCEA to any game-changing advancements.
If you buy a penny stock thinking it will become the next Amazon, you’re basically buying a lottery ticket. That can be fun, but it’s no way to build your trading account.
The right way to go about it requires discipline and a good trading plan.
What Are the Advantages of Investing in Penny Stocks?
Slow down — there are zero advantages to investing in penny stocks.
Here’s the disclaimer: penny stock investments fail 99.9% of the time. Sure, there are some penny stock ETFs that post decent gains…
But that isn’t one of the purposes of why I’m writing this article. And it shouldn’t be what you’re reading for…
Day trading is what penny stocks are good for.
Let’s table the fact that these companies have cheap stocks because their goods and services aren’t in demand…
We’re playing a different game here. It isn’t about underlying value. It’s about rampant speculation, which you can trade on.
You Can Start Trading with a Small Account
If you’re a small account trader, you can’t be content with the 10% gains that larger accounts target. Your needs are different. Thankfully, penny stocks can give you that opportunity.
These volatile stocks have a much greater range than pricier, established stocks. You can grab the conservative 5–10% gains I target in a single trade.
I go for singles, not home runs. The $7.4 million I’ve earned in my career is proof that small gains add up.
Easy to See Gains
Take a look at this $1,152 trade I made in minutes on Wisekey International Holding (NASDAQ: WKEY) — starting stake $3,120.
That’s an almost 37% gain on some feel-good news about a meeting with Elon Musk.
No sales came out of this meeting. Within a couple hours, the share price fell to lower than where I entered the trade.
I realized these gains because I didn’t get greedy. Everybody sees the gains that penny stocks are capable of — but they tend to ignore the collapses.
Remember this chart well, its the basis for my 7-step framework, @30DayBoot & @completepenny & you must study not to fall prey to greed/ignorance or you'll get wrecked like 90% of traders. It's VITAL to sell into excessive strength/hype, do not just hold & hope like most newbies pic.twitter.com/QsAGHsI6lp
— Timothy Sykes (@timothysykes) February 28, 2021
Competition is Low
The reviews are in: most penny stocks are scams. That’s why “smart” traders stay away — they’re liable to collapse at any minute.
You’re within your rights to stay away from these dangerous stocks. But agile traders can ride the waves of speculation to gains — as long as they cut their losses quickly.
Possible Price Growth
Not every penny stock collapses like WKEY. Some show days, weeks, or months of growth… before collapsing.
Penny stock growth can be tricky even if you’re looking at their charts. For example, look at the chart of EV stock Arrival (NASDAQ: ARVL).
The chart says that it ran up past $1,500 in 2020… but that’s accounting for the 1-for-50 reverse split ARVL conducted to get back to Nasdaq’s $1 share minimum.
Potential Risks of Investing in Penny Stocks
You mean, besides for blowing up your account? Let’s run it down…
Traders like me like volatility. Investors don’t.
Your job as a trader is to profit from volatility, do NOT fall in love with any trade or asset as a trade is not profitable until you lock in your profits & getting emotional can muddy the waters. Similarly, it's difficult to cut losses fast if you become too emotionally involved
— Timothy Sykes (@timothysykes) December 7, 2021
When you trade, you can profit off these moves. When you “hold and hope,” you go wherever the penny stock takes you — usually straight down.
Win or lose, you need liquidity to exit a trade. Many penny stocks trade at such a low volume that you can’t exit when you need to.
Pumps are the religion of penny stock land.
The penny stock trenches are full of scammers, spammers, and deluded newbies…
Their religion is that their asset of choice is “going to the moon.” Even if they end up selling at a loss, they’ll be back on the train as soon as the next pump starts.
Lack of Information
This is why Wall Street stays away from penny stocks — they can usually make any claims they want because their books are cooked.
Some of my favorite penny stocks to trade are OTC pink sheet stocks. These are unlisted stocks that don’t publish sufficient financial information to meet exchange requirements. That means you don’t know if they’re lying about any of their outrageous claims.
I have a simple solution for this. Assume that every tweet out of a penny stock promoter is a lie, and trade as safely as you can!
5 Tips on How to Choose the Best Penny Stocks to Watch
I want my students to become self-sufficient. Like I said before, my watchlists aren’t rocket science. I build them by sticking to these five steps.
Tip #1: Look for Big Percent Gainers
How do you find hot stocks? The first step is learning to use the right stock screener tools.
I use StocksToTrade — a powerful trading platform with more than 40 built-in scans. It doesn’t hurt that some of them were tailored around my strategies.
I scan in premarket to know what’s moving. Penny stocks that know the game often put out PR in premarket. This gives traders the whole day to send their stock prices up before they dilute.
I typically look for 10% gainers. These are the stocks that the rest of the market has their eyes on.
Tip #2: Look for Big Volume
Volume is the proof of demand. If a stock has enough volume — on a small amount of shares — that’s a good sign that the price will continue to move.
Plus, big daily trading volume usually signifies liquidity. Even if you lose money on these stocks, you can always unload them quickly.
Tip #3: Look for a Penny Stock News Catalyst
The ‘product’ of most penny stocks is their own stock. They want to pump it up, then the stock’s insiders can trade into this built-up demand.
A lot of penny stock traders will believe anything, but I won’t. I want to see real news and events behind a stock move before I trade it. News catalysts can come from anywhere — Instagram, newsletters, actual news outlets …
News catalysts usually come from companies that are frequently in the public eye. Find penny stock companies for your watchlist with a strong media presence and you’ll be prepared for future catalysts.
You can look on the internet for news — or better yet, check out my favorite news alert service, Breaking News Chat!
EVERYONE needs to use the @StocksToTrade social media search tool & breaking news tool, they’ll open your eyes to what’s happening these days across so many chat rooms/websites/“communities”, pretty amazing to see the pumping of stocks like $FWP $GNUS $FRSX $CREX
— Timothy Sykes (@timothysykes) May 13, 2020
Breaking News Chat is my secret weapon — and the key to a good number of my recent trades.
Tip #4: Look at the Long-Term Charts
I talk about former runners a lot. That’s one reason I’ll research a stock’s long-term chart…
If I know it has run in the past, I’ll know it can do it again. And looking at its past performance data can help me tell the difference between a multi-day runner and a one-and-done spike.
My usual advice still stands — react, don’t predict. Don’t research past data trying to predict when the stock’s going to run. Research it to understand the effect that unusual volume and news has on the stock, so you can react faster.
I don’t do anything too complicated with my charting and analysis. I’ve been using my 7-step pennystocking framework for the past 10 years…
I still use it because the game hasn’t changed.
Tip #5: Use the Twitter Scanner on StocksToTrade
You have to know if a stock is being pumped before you trade it. Twitter is the first place all the wannabe influencers go to hype up a stock.
If you’re wary about getting sucked into the Twitter hellscape, StocksToTrade is way ahead of you. Using the built-in Twitter scanner, you’ll have access to a running feed of stock tweets.
You can even customize the feed if you like.
If Most Penny Stock Companies Fail, Why Not Just Short Sell?
Shorting is the easiest way to blow up your account. And it’s even more dangerous now that retail traders know the signs of high short interest.
Since GameStop squeezed on short interest close to 120%, they’ve been out for blood.
When you buy a stock, you can only lose what you put into the position. When you short sell, you risk all the money in your account.
Of course, you can hit your targets as a short seller. Many of my top students focus on short selling, the same way I did a decade ago. But the number of messages and comments I get almost daily from short sellers getting caught in short squeezes is … scary.
How Much Money Do I Need to Get Started?
Many brokers have done away with minimums for cash accounts. But that isn’t the cost you should be worried about. The market will take your money if you’re unprepared.
Education is what separates the winners and losers in trading.
Trading gurus can point you to all the “trading opportunities” you ask for. All the market information, resources, and updates in the world mean nothing if you don’t understand the basis for a good trade.
But fear not — giving new traders their education is what I was put on this earth to do!
I’ve been trading for more than 20 years. During that time, I’ve made over $7.4 million in career earnings.
That isn’t what I’m most proud of. It’s that more than 30 of my Trading Challenge students have developed into millionaire traders.
This didn’t happen because they got hot stock picks. I was relentlessly honest about my successes and failures and taught them to be that way too.
How Do You Become a Millionaire Trader?
You don’t become a millionaire trader by trying to impress your Twitter followers with results, like so many other ‘gurus’ do. You get there by being honest with them, and yourself. That’s why I’m always honest with my students — ESPECIALLY about my failures. I’ve even written articles about failures and how to recover from them.
Because they’re not real failures if I’m following my rules, and cutting my losses quickly. When I lose, I want to show my students the right way to trade. That’s the secret to becoming a self-sufficient trader — knowing how to manage your losses.
Join My Trading Challenge Today
Are you ready for this level of real talk? Apply for my Trading Challenge and show me what you’ve got.
We don’t accept everyone. We like to limit our community to people who are humble, people who work hard.
Think you’ve got what it takes? Apply to my Trading Challenge today!
Penny stocks can be a blessing or a curse — it’s all in your trading strategy.
- Trading penny stocks can be risky due to lack of company information, making transparency and communication key factors to consider.
- These stocks could experience rapid growth … or just as easily experience rapid collapses!
- I NEVER invest in penny stocks, I only trade them. That means trading with a plan both for your entry AND exit.
If you’re new to this, start paying attention. Study the things I teach.
Trading is a battlefield. The more knowledge you have, the better prepared you’ll be.
Working hard is the only way to survive in penny stock land.
What’s on your penny stock watchlist? Let me know in the comments!
What Are Penny Stocks?
Penny stocks trade for five dollars or less per share. Institutional investors usually won’t touch them. Why? Some factors include their low cost, which makes them ripe for speculation and big-time volatility, and their lack of sustained growth. Some are listed on the major exchanges, others trade on the OTC markets.
Are Penny Stocks Worth It?
I like penny stocks because they give traders with small accounts a way to quickly make 10% or more on a trade.
Are Penny Stocks Dangerous?
Penny stocks are only dangerous when you trade without a plan, risk money you can’t afford to lose, and don’t cut your losses quickly. These mistakes are why penny stocks have gotten a bad rap.
How Do You Watch Penny Stocks?
Check out the article for a detailed rundown… I make a new penny stock watchlist every day, and keep a roster of other watchlists as well.
Can You Become a Millionaire from Penny Stocks?
It’s possible for a trader to become a millionaire from penny stocks — just ask the 31 Trading Challenge students I’ve helped cross that threshold. The tricky part is how you can become a millionaire from these shady stocks. It isn’t by picking the right stock, and holding on for dear life. It’s by learning the patterns and techniques I teach my students.
How Often Do Penny Stocks Go Big?
Penny stocks go big often… but then they usually collapse. Don’t be suckered in by the big gains some penny stocks make. The way to trade penny stocks profitably is to sell into strength, and get out before all your potential profits disappear.
What Have Been the Most Successful Penny Stocks?
The most successful penny stocks include the likes of GameStop Corp. (NYSE: GME), Plug Power Inc. (NASDAQ: PLUG), Advanced Micro Devices (NASDAQ: AMD)… and oh yeah Apple Inc. (NASDAQ: AAPL). But don’t let this fill you with FOMO. Penny stocks aren’t lottery tickets. Don’t trade on a hunch, trade with a plan.
What Do Analysts Say About Penny Stocks?
Analysts generate reports on various penny stocks to watch. They look at the business operations of these companies and provide analyst ratings that give an overview of market sentiment. These reports can influence investment decisions, and in turn create demand or lack thereof.
What Markets Are Most Common for Penny Stocks?
Penny stocks can be traded in various markets. Many are listed over-the-counter, while others may have their bids placed in international markets like Canada or China. Knowing the type of market can influence your investment strategy.
How Can I Stay Updated on Penny Stocks?
To keep up with the latest trends and news on penny stocks to watch, consider subscribing to specialized newsletters or becoming a partner in trading forums. They often provide links to additional resources, and some even offer insights under their ‘light’ subscription plans.