Which way? Penny Stocks education
- Thread starter themickey
- Start date
Written by a guy who is publisher of a newsletter that is so 'world-famous' that I haven't even heard of it before.
Today a penny stock I hold got smacked down 50%.
This stock is one I've told myself not to buy as it's business is overseas, only holds a small office here in Australia.
Anyhow, a couple of weeks back bought in at 0.049, another bite 0.052, another bite 0.040.
Today got a whacking down to 0.013 on open, when I saw it was 0.017 and so took another bite.
Why buying? Because it shows huge trade sizes and huge volume for a penny dreadful.
That's my only reason, besides it's into oil & gas.
Intraday price chart as of now, market has been open 2 hours.
DOM currently.
Turnover for 1st 2 hours of trade today $16.5Mill, for a 2c stock that's pretty high.
This stock is one I've told myself not to buy as it's business is overseas, only holds a small office here in Australia.
Anyhow, a couple of weeks back bought in at 0.049, another bite 0.052, another bite 0.040.
Today got a whacking down to 0.013 on open, when I saw it was 0.017 and so took another bite.
Why buying? Because it shows huge trade sizes and huge volume for a penny dreadful.
That's my only reason, besides it's into oil & gas.
Intraday price chart as of now, market has been open 2 hours.
DOM currently.
Turnover for 1st 2 hours of trade today $16.5Mill, for a 2c stock that's pretty high.
Often it's difficult to catch that first move because usually its hard to initially discern in the first hour(s) whether it is genuine or just a one day flash in the pan. The first day's move can be very fast and leave you wondering whether it is now too late to jump in as one really is chasing a stock. For stock traders they need live data as well.
Penny stock trading usually is very volatile so that carries additional nerves, drawdowns large.
Yesterday I added to a penny stock I already was in, it had moved 50% upward when I entered (gapped up on open) and at close of day was up 95٪.
Nanocap and microcap carry far more risk of problems than smallcap. They are so well undercapitilized that its difficult for them to get enough money to operate.
In this instance of entering I got in under 3c only because I spotted it quickly and as I already held and had marked this one previously and intended to add to, as I was watching the current pullback. So in this instance no thinking was required about whether to or not to buy, as I had intended to buy more anyway. All takes patience though and a strategy.
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Freakin' waiting is the hardest part ain't it?pullbacks are good hints I think for a "signal" but it really does take patience as I'm finding out
Congrats Mick!
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Using traditional TA signals like indicators won't work on pennies, perhaps that's why they have a bad reputation.Nice catch!
Yeah those pullbacks are good hints I think for a "signal" but it really does take patience as I'm finding out
In the penny stock instance above, the clue to buying earlier on was Gina Reinhart (iron ore barroness) showing an interest in the company.
As mentioned earlier in this thread, directorship quality is very important.
Saying that though, at times I buy penny stocks I dislike, but only due to high consistent $ turnover, those though I won't hold into a drawdown, I'll slam on the brakes at the first sign of trouble.