Buy Penny Stocks

best-penny-stocks

A penny stock іѕ а stock that tгades аt а low price maіnlу bеtweеn one аnԁ fіѵе dollars. ӏt ԁоes not tгаdе within the mаϳoг market exchanges likе the Νеw York Stock Еxchаngе, Νаtiоnal Аѕѕоciаtiоn оf Securities Dеalеrs Automateԁ Quоtаtіоn System (NASDAQ) or the American Stock Εхchange.

Αlthоugh thеу ѕеll mainly at оnе dollar, the ѕhагеѕ mаy ѕеll for uр to tеn dollars ԁереnԁing on promotion anԁ аdvеrtisеment. They аге normally trаԁеԁ in small ехchаngеѕ anԁ over-thе-соuntег maгkets thгough over the counteг Bulletin Воагԁ (ΟTϹΒΒ) and pіnk shеetѕ

Тhеге аге twо mаіn ways оn how to buy penny stосkѕ. Τheѕe arе either оnlіne or thгough brokеrаgеѕ.

Usіng Stock Brokers

Мany stock buyегѕ depend оn agents oг stock brоkеrs to act оn their behаlf. Τhеy let thеm knоw how many stocks thеу want, frоm which company, the tісkeг symbоl аnd the market thе stock is trading оn. Sоme аgentѕ ԁo not require any commiѕsіonѕ. Τhey make their mоneу ԁеpеnԁіng on thе ԁіffегеncе between the bid and the aѕking ргіcе. Τhis difference iѕ cаlled the sprеаd. The hіghеr the spread, the mоrе money bоth thе buyer anԁ hіѕ agent make.

The choіcе of a gооd stock bгоker is еѕѕentiаl. Some brokers ѕіmрly want to get rid оf the stock without carіng muсh for the buуег. Оnе shоuld consider а trustworthy brоker and theiг сommіssiоn fees. Anоthеr faсtоr to cоnѕiԁеr is hоw much оne neеdѕ to open аn account wіth thеm. Sоmе brokers alѕo сhargе for dormant acсоuntѕ. It іѕ аdѵіsаble to alsо fіnd out if the stock brоkег уou choose hаs any bеnеfitѕ for уou. Ѕоmе banks alѕо offer the seгѵіcе of buying and ѕellіng stocks.

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Вuуing Penny Stocks Onlіne

Аnоtheг wаy on hоw to buy penny ѕtосks іѕ oѵeг the internеt. Тhе аԁvantаgе of buying penny stосkѕ onlinе is that yоu have quick аcсеѕѕ whеn you nеeԁ tо either buy oг sell. Тhіѕ way the buуer takеs the profіt quickly rather thаn сalling an agent оvег the phone and aѕkіng thеm tо seal the deаl оn уоuг behalf.

Ӏn оrder to tгаԁе onlinе, оne neеdѕ to ѕign uр and open а trading aсcоunt. Τhіѕ aсcount neеdѕ to be funԁеԁ from the аcсount holԁeг’ѕ bаnk. Once the aссоunt has money, the buyeг thеn gоеѕ to the іnternet and staуs on the loоk оut for trading penny ѕtоcks. Тhіѕ cаn be ԁоne by joіning fогumѕ or lооkіng out fоr nеw ѕіtеs that announce penny stock traԁіng.

Аnаlуѕіѕ аnd Rеѕеaгсh

Βеfоге buуing stocks, buуегѕ nеeԁ to research on the соmpanу they wаnt to buу stock from. Тhеу hаѵe to find оut the market саpіtаlizаtіon. Τhiѕ сan bе ԁоnе bу multiрlying the аmount per ѕhаге bу the number of shаreѕ in the market. Тhiѕ should alѕo ԁеtегmіnе how many penny stоckѕ to buy. The mоге оnе buyѕ, the morе гeѕeагсh one has tо ԁo on the comрaniеs.

Оnсе a buyег unԁеrstands thе technіquе оf hоw to buy penny ѕtoсkѕ, theу cаn mаkе a lot оf money sіmply by tгadіng in thе penny stock market.
Trading Penny Stocks – The Major Types Of Market Orders

Trading Penny Stocks

When you begin trading Penny stocks, it is extremely important to understand how to place an order. By far the most critical aspect of find a penny stock is to understand the different types of orders that are available to you. What we’re going to do is examine the order types. Basically, there are four primary kinds of stock orders you can place with your broker.

Trading Penny Stocks Requires A Thorough Understanding Of Market Orders

The very first type of order is by far the simplest, this is known as a market order. When you place a market order, you are telling your broker to go ahead and buy or sell a certain stock at the posted bid or ask price. So what ever the market is offering a the time, that is what you will get. The best thing about a market order is that they are executed quickly and faster than any other type of order.

However, a market order is by far the worst order you can use when trading Penny stocks. Why? Because you stand to get your order filled at an awful price. The first indication of this danger is by first looking at what the current bid price and asks price are. The difference between these two numbers is called the spread. If the spread is too large, you are going to get killed when your market order is filled.

The next type of order that is used in buying and selling stocks is known as the limit order. When you place a limit order, you are telling your broker to buy or sell a particular stock at a certain price or better. This is the order type you need to use when you are trading Penny stocks. It assures that you get your order filled at a reasonable price. Using limit orders does require some patience however. Often times, when you place a limit order at the bid or ask price up it will not get filled. What you have to do is play around with the number and move it up or down until the order gets filled at a price you can live with.

The third type of order is one you should always use immediately after buying any stock. This is known as a stop order, or the stop loss order. When you place a stop order your telling your broker at what point you want to automatically sell off your stock position. Stop orders will do one of two things. They will either limit the amount of loss on a stock, or they will lock in a certain level of profit. Either way, they should be used religiously.

The last type of order is called a stop limit order. This is one that is not used very often by traders. It is similar to the stop order with the exception of having a limit order triggered once the stock reaches a target price.


What To Look For When You Buy Penny Stocks

Have you been looking to buy penny stocks? Often times you will hear about how risky of an investment that they can be, but honestly they do not have to be as long as the risk is managed properly. If you are well versed about the stocks you select for consideration and have researched them thoroughly, then you shouldn’t have any problems at all. In the end, the whole secret to your success is knowing how to buy penny stocks.

How To Buy Penny Stocks

Basically, there are three elements that you must evaluate when you are trading penny stocks. The first of these is that you need to find a company that is undervalued. This may sound difficult, but it is not as difficult as you may think. One approach to finding undervalued companies is to examine large fields or industries that are trading well in the markets. Within these larger markets will lurk smaller more specialized companies that are often overlooked. Lots of winning penny stocks can be found this way. For instance, you might look for small companies that specialize in microprocessors within the computers industry. The perfect scenario is when one of these smaller companies who specialize goes in on a marketing deal with one of its bigger non-specialized counterpart companies. When such an event takes place, it is a great time to buy the penny stock of the small company.

Getting A List of Penny Stocks

The next element of a great penny stock scenario is when long term collaborations take place between two of more companies. You are almost assured of a winning stock if the company locks into an arrangement with a larger company. For example, if the computer company commits to an exclusive 5 year contract with the smaller specialized company that makes microprocessors. An example would be the specialized company again. The smaller company’s stock would most likely rise immediately and continue to gradually rise over the term of the contract. As an investor, it is a great idea to maintain a list of penny stocks from companies who specialize within bigger industries.

The final element of a successful trader comes through research. When you are just learning the stock market and learning how to construct your penny stocks list, get in the habit of conducting solid research. They will make you a success above all else. You will want to find out all you can about a company. Just use your common sense as you find out more about them. If you are diligent about doing all of these things, then you will know how to buy penny stocks successfully.
Learning How To Buy Penny Stocks

So you want to learn how to buy penny stocks? Many people love trading them as they are stocks that typically trade anywhere from $0.01 all the way up to $5. And as you might expect, when you go about buying penny stocks, you generally won’t find them anywhere on the major stock exchanges. So when you decide to learn how to buy penny stocks, you have to realize the distinctions between them and regular stocks.

All About How To Buy Penny Stocks

Lots of people these days are buying penny stocks online which has added a whole new dimension to how they trade. For one thing, these stocks are handled by smaller exchanges and quoted through OTCBB and the Pink Sheets. Beware as the Pink Sheets are not registered through the SEC and are not subjected to the same restrictions as the OTCBB, so those could be risky. So when you are learning to buying penny stocks, it is a good idea to stay away from the Pink Sheets until you become more experienced.

The thing is that everyone is looking for that nickel stock that goes all the way up to $10 or even $50 per share. You have to understand that moves like that are legendary and don’t come around that often. And when they do, who knows to buy penny stocks that exhibit that potential?

The two primary means of buying penny stocks are either using an online discount brokerage or using a standard stock broker.

Using Standard Penny Stock Brokers

For years and years, a lot of investors have use and come to depend on agents or stock brokers to initiate all their transactions. These types of buyers simply tell them what stock they want to buy and how many shares. The agent’s fees or commissions work in many ways. Some agents charge a flat fee for making your trade. You need to confirm whether the fee is for a “round turn” trade or if they charge you the fee for each “leg” of the trade. The two legs being defined as buying the stock for the first leg and selling it for the second leg. Other more sophisticated agents will not charge a direct fee but take their cut out of the spread. The spread is defined as the difference between the bid and asking price of the stock. This arrangement is pretty rare though.

The biggest disadvantage of using a full-fledged stock broker is where their loyalties lie. When new traders who want to learn how to buy penny stocks use a broker, they usually rely too much on the broker’s view of the markets and get talked into and out of trades. Also, brokers are sometimes urged by their companies to push certain stocks. Thus, your best interests may not match up very well with yours.

Buying Penny Stocks Online

The most popular way to trade nowadays is to buy penny stocks is over the internet. This offers traders a huge advantage over traditional ways of buying penny stocks. For starters, you can see for yourself at any given money what the bid and asking price is and your order gets filled promptly. Secondly, you have direct access to profit statements and price charts – something that only stock brokers could see previously. And fees and commissions for executing these trades are dirt cheap because there is no live stock broker that has to be paid.
Another great benefit is that you are forced to learn more yourself because you are doing everything yourself and not relying on a broker. This forces you to do your own research, execute your own trades, and develop your own trading plan. What better way to learn how to buy penny stocks?

The Importance of Research Before Buying Penny Stocks
There are a few items that you must address to be successful. Penny stocks tend to be very volatile at times. And also, you have to be aware that if the stock you want to buy doesn’t have enough liquidity, then you can get killed when make purchases. Therefore, rule 1 is NEVER buy a penny stock without using a limit order. This is lesson one of how to buy penny stocks.

Daytrading Penny Stocks Made Simple

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Because of so many people searching for the stock exchange in an effort to earn money, it really is vital that you take a while and extremely learn your work prior to going diving into something you are truly not ready for. The general advantages of effective daytrading are very large, although the effects could be substantial too. Learning the guidelines and methods that will help you to rapidly start buying and selling effectively is going to be advantageous because you will have the ability to avoid all the problems and effects that others experience without getting just as much difficulty because they have experienced too.

Taking the first head to the daytrading market will probably be very frightening. It is crucial that you simply take a while to actually make sure that you do ample research and this is when many people find that they’re falling far behind the training curve. Visiting the trouble to really do proper research is difficult you will find lots of distractions on the way. You may be enticed to merely drop your hard earned money in to the first stock that you simply find, but it’s not necessarily the best using your hard earned money.

It’s very essential that you take time to review any stock before buying it. Getting any chance you need to investigate is going to be very important to be able to be effective. Daytrading typically works from designs. At certain points stocks is going to be low, and also at other points the stocks is going to be high. You have to learn to place these designs to ensure that you are able to effectively grab the stocks when they’re low to actually obtain the best results possible in the quick transactions.

To become effective at daytrading your main goal is to find the stocks as inexpensively as you possibly can and change then sell them as rapidly as possible once the cost rises. This will help you to really increase your potential profits and use you to definitely improve your overall success. Obviously, things don’t invariably appear, you will see occasions whenever a stock won’t do what you would like and you’ll end up attempting to bail out as rapidly as possible with no downfall which you may experience of an entire loss.

Knowing when you should pull from the marketplace is crucial for every day trader. Your main goal would be to obviously sell high, this really is not necessarily the situation. You have to determine for every stock that you’re coping with what your cheapest value is. When the stock reaches this time, you have to take out and reduce your deficits. Not every stock follows their typical pattern all the time. You will find certain to be occasions when you won’t result in the profit that you’re after. Eliminating as rapidly as you possibly can throughout these occasions is essential.

A great experience of the stock exchange is really possible no matter the knowledge you have. Effective daytrading can happen for those who have many years of experience also it can also occur for individuals who’ve merely a brief quantity of experience under their devices. It is crucial that you simply continue buying and selling after you have begun determining your perfect solution. Going slow and making the effort to softly determine your very best strategy will help you make sure that you make the right options and that you’re moving in direction of elevated assets.

Elevated assets is a area where lots of people are unsuccessful, they’re so ended for making bigger trades they risk everything that they’ll. This really is god if you’re careful if twill permit you to improve your wealth considerably faster, however if one makes an incorrect move you’ll rapidly end up out all the money you have been attempting to invest.

How to Find Best Penny Stock Setups

Penny Stock Setups

I am not seeing too many superb setups right now as of today so I thought I would do a little write up on what I believe to be the important factors that make for the best penny stock setups.

But before I do that CEMJQ might be worth a quick mention. If it can hop above .25 and stay above there it may be able to get another run started. Right now the broad market is going into a pretty nasty correction so I am not sure what effect that will have on CEMJQ as of now. But so far CEMJQ has held up well. A break below .20 would destroy any chances of a good pop in the near term. So maybe worth keeping an eye on.

Ok, so now what are the factors that make for the best penny stock setups?

I have been thinking about this for quite some time and I can tell you that there are a couple factors that make for the absolute BEST penny stock setups, but they are exceedingly rare. They are:

A penny stock that has had a very large upward move, but then has gone into a long sideways consolidation (perhaps forming a large triangle or a head and shoulders bottom formation).
The previous point has occurred only AFTER a very long decline in the penny stock (ie. long bear market trend).
The reason why the above two points make for the absolute best penny stock setups is because you are doubling your odds of success. You have a situation whereby a stock has come down after a long bear market but then has entered a new bull phase and THEN gone into a long sideways consolidation… It is that long sideways consolidation that you must watch like a hawk and determine an entry point because then you will be able to ride up with the next major up trend.

penny-stocks

These types of penny stock setups are the most ideal because you can ride the trend up for a month or two knowing in full confidence that you are in a bull phase move of the stock. You also have plenty of CAUSE built after the initial move and sign of strength.

There are three penny stocks that I can think of that made such moves and all three of them were extremely profitable to those that were able to identify the initial structure and then jump on for the next move.

The symbols for the three are SRSR, GSPG and IDGI. Sarissa Resources, GoldSpring, and Inca Designs.

To the left is a chart of SRSR (Sarissa Resources) just to give you an idea visually of what I mean. The first long red arrow shows the long previous bear trend I was alluding to above.

Then you see that initial large sign of strength move off of the bottom. But THEN SRSR went into a long sideways consolidation forming a symmetrical triangle. That price action is the mot valuable because it is just churning and cause building for the next big move. It gives you plenty of time to prepare for the next move and gives you advance notice of it as well.

You will see plenty of other penny stocks make 100% moves from all sorts of formations, but I have found over time that this general structure is the most powerful and reliable in terms of realizing extended profits.

The problem is you do not find these patterns that often. So if you ever do see one please let me know so I can share it with other visitors here at penny stocks penny stocks dot com.

The other type of penny stock setup that I like to try to find are the dormant bottom variation where you have a penny stock that has been trading very flat for a long time with only minor rallies and spotty volume. Preferably it will have a very low number of total outstanding shares and a small float as well. These can be also very tricky to find and identify because of their low trading volume.

What I like to see with these dormant bottom plays is successively higher price ranges, sort of like a stair case. When you start to see that off of a flat long base, then keep open to the possibility that you will see a very big move coming. Certainly volume analysis helps a lot too when trying to confirm their possible success rates.

So far I have not been able to find a good piece of scanning software that is able to identify penny stocks that trade in a long flat base.

The best real time scanning software I have seen so far for pinksheet and otc bb penny stocks is equity feed. They may have some scans that help identify long consolidating penny stocks with flat bases but I have just not used the software enough to be able to tell you that it can do that. But there are definitely good volume and price scans contained within equityfeed.

Bubble Territory for Bitcoin?

top-cryptocurrencies

A common word that is thrown around these days in light of Bitcoin’s meteoric rise in 2017 is ‘Bubble’. Bitcoin went on a tear in 2017, generating an unbelievable 1,500% year to date return. Understandably, people have become wary of the sky-high market cap of the flagship cryptocurrency, as can be seen during the panicked sell-off and subsequent recovery that happened recently. Much of this fear likely stems from the all too recent memory of the 2008 financial crisis. In fact, we see from a variety of sources that participation in the stock market has not recovered to pre-crisis levels, leading many Americans to be left out of the bull market rally. Bubble seems to be a term that is thrown out lightly these days, as investors are on edge thinking that the next recession is just around the corner. Market psychology aside, let’s examine whether Bitcoin actually fits the bill of a Bubble.

Comparison to Historical Bubbles

(Tulip Mania chart – At its peak, a single tulip fetched more than a skilled craftsman could earn in a year source)

Many people, particularly those who don’t understand Blockchain technology like to equate the Bitcoin price appreciation to the Tulip Mania craze of the Netherlands in the 1700s. At first glance, this seems to be an apt comparison. The same exponential price increase, speculation based on the FOMO effect, and lack of intrinsic value. If accurate, this would mean that Bitcoin is doomed to repeat the crash back to Earth that Dutch Tulip Traders suffered. However, it is clear that these two situations are not comparable, because the price increase of Bitcoin is underpinned by the revolutionary technology of Blockchain. Therefore, investors are not simply attempting to cash in on a temporary craze, but instead, betting that Bitcoin will lead a revolution in the way we think about currency. Furthermore, Bitcoin has already faced several scary corrections in its history and each time has rebounded strongly.

crypto-bitcoin-currencies

Another comparison that is fresh in peoples’ minds is the more recent US subprime mortgage crisis. As mentioned before, the fact that this occurred not long ago is inducing people to compare Bitcoin to the housing bubble. Equating these two situations would also be a mistake. In terms of scale, the housing market is on the scale of tens of trillions of dollars. The Bitcoin market cap is ‘merely’ on the order of hundreds of billions of dollars right now. In addition, most homeowners are levered through use of mortgages to fund their purchases of property. I don’t know too many people who have taken out loans to buy Bitcoin. Finally, the housing crisis put the nation’s entire financial system at risk, due to the vast amount of securitization of mortgages and the bets placed on them via derivatives such as credit-default swaps. Goldman Sachs put it best in a recent article (paywall, institutional account required) where they remarked on the scale of cryptocurrency and simply stated: “It is unlikely that a hypothetical (sharp) correction in the price of cryptocurrencies would represent a negative macroeconomic shock.”

To be fair, Bitcoin does exhibit some of the characteristics of a bubble: the rapid price increase that has defied any valuation logic, the fact that it is used more as a store of value than for its intended purpose, due to high transaction fees, and the irrational exuberance exhibited by its devotees. To really become a mature bubble though, Bitcoin would need to achieve mass adoption, which it certainly has not done yet, though it is on its way. It is impossible to know how many people own Bitcoin, but estimates are in the order of 25 million around the world, with many of those 25 million owning extremely negligible amounts. (source: Are you in the Bitcoin 1% ? A New Model of the Distribution of Bitcoin Wealth). To put that number in perspective, over 150 million people own stocks just in America. The fact that Bitcoin is a digital currency that requires a certain degree of tech savviness to obtain has served as a roadblock to mass adoption. This leads me to believe that if we are indeed in a bubble, we are still in the early stages, so there is significant upside, albeit with a high degree of risk.

In summary, I believe that although we may be in a Bitcoin bubble, the comparisons to historical bubbles are misguided, due to the unique circumstances surrounding this new, potentially revolutionary technology. In future articles, I will dive more deeply into the risks and potential of Bitcoin and the strategy for investing in Bitcoin and other cryptocurrencies.

Besides owning Bitcoin and cryptocurrencies directly, exchange traded securities that may give investors the desired exposure to this asset class include Bitcoin Investment Trust (OTCQX:GBTC), Winklevoss Bitcoin Trust (COIN), Bitcoin Services Inc (OTCPK:BTSC), and First Bitcoin Capital Corp (OTC:BITCF). In future articles, we will address each security in detail.

How To Get Started In Penny Stocks

Penny Stocks startups

If you are looking to get into the stock market, you may be interested to know that you can get started in penny stocks by investing a relatively small amount of money on a short term basis for very high gains.  Investing in penny stocks is an alternative option to conventional blue chip trading, which offers you the opportunity to manage short term investments yourself with the  potential  of yielding triple digit profits of 400% and more.

Sound good?  Go here to find our recommended penny stock investment program.  Read on to find out what you need to know to cash in on this lucrative investment strategy.

What’s so special about penny stocks?

Trading in penny stocks can yield extremely high returns, however it can also be extremely risky with less than 3% of penny stock companies ever yielding any profits.  Having said that, over the past 40 years, these small cap stocks have significantly outperformed the overall market.

Penny stocks often sell under the radar for less than $5 per share and sometimes for a few pennies, and yet they have provided explosive investments of a type that have only been associated with days gone by.   However, even though these cheap stocks have the potential of soaring in value very fast, you won’t be hearing anything about them on Fox Business News or CNBC, because they are considered too small for investment banks to get involved in.

Fact is, big investment banks would rather keep this market a secret as they would prefer you to invest in stocks and shares that they control.  Buying up millions of penny stock shares would explode the share price and potentially divert potential profits away from them.  That is why very few people are aware of the existence of penny stocks and how to take advantage of the dizzying returns on investment they offer.

All early investors in large cap stocks like Wal-Mart, Dell, Cisco and Microsoft are now living the high life because they invested dirt cheap before the masses were alerted, causing the share prices to rocket.  And although it would be great, you don’t have to find the next Microsoft to profit in penny stocks.  You just have to know when to move.

PENNIES-LOBBYING

How to Start Investing in Penny Stocks – Find a Broker

If you are new to stock investing, the first thing you would want to do is find a way to invest your money.  You need to set up an account with an accredited penny stock broker, or through an online brokerage account.  The accredited broker will watch the stocks, make the trades for you and provide some advice.  If you use the online brokerage account, you are in complete control of the trades.  There are fees charged for both kinds of services.  Investigate the fee schedules of any service you are considering and whether the services are compatible with your requirements.

How to get into Penny Stocks – Do Your Research

The key factor in penny stock trading is research.  You need to know everything about the company you wish to invest in.  With penny stock companies, this may prove to be difficult as they will generally be small and unestablished, relatively unknown and often unheard of unless you intensify your research.  Things to look for are online analytical reports that will give you a good indication of the financial health of the company and the way their shares are likely to perform in the market.  News articles are a good source to check for news on the company as well as any strategic announcements or pending takeover bids.

How to Start Trading Penny Stocks –  Timing is Everything

You will need impeccable timing to know when to sell your shares to get the best  gains on your investment.  Avoid being greedy and get out while the current investment is sitting at a good price.  If you are tempted to wait, you may miss your chance when the price starts falling.  Look at the investment objectively and make a decision based on whether the price is a good one considering the status of the company, and decide whether it has shown enough growth for you to make a good profit.  After a few trades you will be more experienced at gauging the market and deciding when to sell.

How to tank in penny stocks – What about that hot tip?

Here’s the thing, 97% of all penny stocks out there are complete duds and will never earn you a dime, let alone a penny!  So, unless you are a real savvy, experienced stock trader like Warren Buffet, chances are you won’t find that golden needle in the haystack.   Remember, you’re looking for undervalued stocks, not under performing companies.  Chances are, that hot tip you heard was a scam, just lots of hype to pump up a stock so someone else (not you) can profit.

If you are serious about this investment strategy you can do all the careful research and educate yourself on the stock market, or you can do what most penny stock investors do and subscribe to a penny stock newsletter or service.  These experts do all the painstaking investigation and number crunching before picking the best stocks and recommending them to their subscribers.

How to succeed in penny stocks – listen to the experts

A good program will educate you step by step on how to get started, stock market jargon,  and how to trade stocks even if you’ve never traded a baseball card in your life.  Most  importantly, a good program will tell you what stock or stocks to invest in, when to get in and when to get out.  Additionally, a good program will have a plan for you to systematically build your wealth.  Stay away from any program that promises to make you a millionaire over night.  That just won’t happen on a couple hundred dollar investment.

You can get started in penny stocks with a modest investment of $200 – $1,000 and see returns in a couple of weeks.  Then invest your profits for further trading, which could result in fantastic returns on your investments with no financial risk.

If you want to learn more about how to get started in penny stocks with a penny stock program check out my review article where I look at the top 4 programs and make my pick.

Bitcoin’s Rally Looks Sustainable – A Technical Analysis

Bitcoin

In this article, the author explains why he has been buying bitcoin and other cryptocurrencies over the past two weeks. This article focuses on bitcoin technical analysis, which points to a favorable setup. Since BTC is the largest cryptocurrency and others are often highly correlated with it, the author has been buying Ethereum as well. 

Bitcoin sentiment is rapidly turning positive. For one thing, mainstream media headlines covering bitcoin has changed from talks of “meltdown” to “Bitcoin broke through $11,000 for the first time since January” (CNBC). The big question now is if bitcoin has already found a bottom and is now set up for a sustained rally. Judging from our technical analysis, we believe this is the case.

Back in January, we wrote an article titled Bitcoin Meltdown: Its Worse Than you Think.  In that article, we warned that, at the time, a 42% pullback from its all-time-high couldn’t even be considered a bitcoin bear market since, 54% of the time, bitcoin trades 40% or lower vs. its all-time-high. We looked at historical drawdowns and warned that it could get a lot worse before things got better.

As we all know, bitcoin’s sell off continued from the time of our article, dropping a whopping 61% from January 26th (the publication date) through February 5th, when bitcoin finally found a bottom at $6,955 (closing price). At that price, bitcoin was 64.3% lower vs. its all-time-high. While are no standards for defining a bitcoin bear market, we believe this recent sell off certainly qualifies. Using data going back to 2012, only 22% of BTC’s trading days were spent trading lower than 64.3% pullback from its previous all-time-high, and most of those dark days were in 2015.

Bitcoin coin

To visualize how bad the recent sell off was, look at the below chart:

As of February 18th, BTC is trading at 45.9% below its all-time high, putting it back within its “normal trading range” as 46% of all trading days were spent below that level (i.e. in 46 out of 100 trading days, BTC traded at or below a 46% pull back from its previous all-time-high).

In addition, we noticed something very interesting in early February: BTC broke below its 200-day moving average on February 5th, and rather than a rapid deterioration in price as we saw when BTC broke through its 50-day moving average in January, BTC rallied 11.5% the following day, pulled back only 1.7% on the second day, and has been trending up since.

Although there are no laws of nature stating that any of these arbitrary moving averages are meaningful, experienced traders know that the 50 and 200 day moving averages are widely used by others, and thus are imbued with psychological significance. When it comes to highly speculative assets with little intrinsic value like BTC, in our experience, market psychology is of paramount importance.

In other words, we believe the key takeaway from our analysis is that the 200-day moving average has served as a support level rather than a resistance level. To see why this is important, let’s go back to the 2014 through 2015 period.

Back in 2014, BTC first crossed below its 200-day moving average on March 27th and stayed below the 200-day for 67 consecutive days. On June 2nd, 2014, BTC crossed above the 200-day moving average but was unable to pull ahead as BTC fluctuated around the 200-day over the subsequent week. This is in stark contrast with what we saw this time around, as BTC is currently trading at a solid 26% above its 200-day moving average (closing price as of 2/18/2018). Even without the benefit of hindsight, it was clear that the 200-day moving average has become a resistance level. The rest is history as BTC spent over a year before it would test the 200-day moving average resistance level once again.

From a technical analysis perspective, we don’t see many parallels between the 2017-2018 period off vs. the 2013-2015 period. But we do see many parallels with the 2013 period.

Back in early 2013, Bitcoin was in the middle of a massive rally as BTC rose parabolically. On April 9th, 2013, BTC closed at a new record of $230 per BTC, before experiencing a bear market. In fact, in 20 out of the 30 trading days, from March 11th through April 9th, BTC set a new all-time-high. This closely parallels BTC’s November through December 2017 rally, when BTC new all-time-high prices 18 out of 30 days during its rally.

We won’t go through every detail of what happened subsequently in 2013, but one key point was that BTC didn’t test its 200-day moving average until July 5th, when it crossed below the 200-day. Then BTC rallied for 8 consecutive days and wouldn’t test the 200-day moving average until March 2014, as discussed previously.

BTC would end up testing and crossing above its 50-day moving average on July 25th, 2013, at $96.90 per BTC, and proceeded to rally 33% over the subsequent 60 trading days. We believe this is important to note since, currently, BTC is still trading at below its 50-day moving average. But at only 9.1% below its 50-day moving average, we believe this level will be tested very soon, which could be a catalyst for further price appreciation.

Since 2012, BTC’s median return in any 60 days out is 16%. We’ve observed that some of the strongest 60-day returns occurred after BTC crossing above its 50-day moving average. For example:

9/27/2017: after 7 trading days below, BTC crossed the 50-day and rallied 109% in the subsequent 60 day period.
7/20/2017: after 11 trading days below, BTC cross the 50-day and rallied 27% in the subsequent 60 day period.
4/3/2017: after 12 trading days below, BTC cross the 50-day and rallied 111% in the subsequent 60 day period.
1/17/2017: after 6 trading days below, BTC cross the 50-day and rallied 21% in the subsequent 60 day period.
9/4/2016: after 41 trading days below, BTC cross the 50-day and rallied 22% in the subsequent 60 day period.

In conclusion, we believe that the technical set up for bitcoin looks very favorable here. In our analysis, the current set up has many more parallels with 2013 than 2014. We are encouraged by the fact that BTC found support in its 200-day trading average and see the potential to test and cross above its 50-day moving average as an upcoming catalyst for further price appreciation. However, while this article focuses on technical analysis, investors should be keen observers of fundamental developments. A major hack or unexpected regulatory headwind could quickly change the trading dynamics. We will do our best to keep our readers informed.

Want To Start Trading Penny Stocks And Make Money Consistently?

penny-stock-platforms

I know something that most people don’t know. I know how to make money consistently in the best penny stocks!… I know 5 things that you must ALWAYS do if you want to trade penny stocks so you make money consistently. I’m going to talk about those 5 things below but first I need to share with you 2 extremely important items of information about penny stocks that most people don’t know.
Find Out How You Can Let Penny Stock Prophet Help You Make Money!

I’m sharing them because I believe that they may totally change the way that you look at trading penny stocks.
A lot of people want to start trading penny stocks but they are afraid to try. They know that they really don’t understand what it takes to make a lot of money in any stock market… let alone trading penny stocks.
They know that the “regular” stock market (NYSE, NASDAQ, etc.) usually takes many thousands of dollars to do right. And, they are correct!
But, I have found that trading penny stocks normally takes much less money. I have found that it takes hundreds instead of thousands of dollars… to trade penny stocks successfully.
In fact, the lower amount of money needed was my original motivation to try trading penny stocks. And, because of that, I have learned that I can, in fact, trade penny stocks successfully with less than 500 dollars in capital!

penny-stocks-investing


What proof do I have?
Simple, I’ve done it!
Second, another misconception many people have is that trading penny stocks is off the charts in terms of risk. Have you heard of Enron, Adelphia Communications Co. or Arthur Anderson Co? They are all “biggies.” What about other “big” names like iVilliage, Internet Capital Group or Infospace… to name just 3 of many large companies that have been investigated or actually alleged to be associated with fraudulent activities…
… Contrary to popular opinion, I have discovered that penny stocks are just like other investments/trades… they are inherently risky and you can lose money.  But, just like with their “big brothers” on the major exchanges, by doing the right things you can reduce that risk to acceptable levels.
And, I have found that it’s really not that hard to reduce the risk if you will follow some basic rules.
If you will let me, I would like to share some of what I’ve learned over the last 20+ years that I’ve been investing and trading in various Stock and Options Markets.
Almost no one tells beginning investors and traders the 3 things that you actually need to know about trading… Especially when you are trading penny stocks.
… First, don’t fall prey to urgency.  Urgency is a figment of your imagination combined with your greed.  You can not lose money in the penny stock market that you don’t invest there.  If you are feeling urgent about an investment or trade I advise you to do nothing!
Be patient. Remember the old English Proverb “All good things come to him who waits…”.I promise you, another opportunity WILL present itself soon!!!
I believe that false urgency has caused more people to lose money than almost any otherfactor when they are investing or trading in the stock or options markets.
Why do they do that?
Simple, … They don’t want to miss out on making some money.  In other words, they get greedy and they move before the time is right. And, timing is the second point…
… Second, the timing must be right.  If you move too soon, you may end up paying too much and that can turn a very nice profit into a nasty loss… Too late, and you may miss the opportunity entirely.
Even worse, you may not take the time to evaluate what you are going to do. Never, make your move before you know for sure that it is the right thing to do.  I’ve lost more money than I care to admit because of bad timing and it was usually mixed with a fair amount of urgency.
How do you know that an investment or a trade is the right thing to do?
Actually, the answer to that question is the third thing that I want to share with you…
… Third, you need to know and adhere to the “3 Rs.”  Maybe you are old enough to remember the “3 Rs” from your grade school days: Reading, ‘Riting and ‘Rithmetic.  It’s not that of course… The 3 Rs of Investment and Trading depend upon human judgment, not on some magic formula or some stock picking computer robot.
The 3 “Rs” of Investment and Trading are:
Research – you always need to research areas of interest thoroughly or you will never get rich. It doesn’t matter if you subscribe to a stock recommendation service, “roll your own”, or read the reports supplied by your broker… you will want to research the markets, the economy and the individual issues that you are thinking about “getting into”… before you put your money on an investment or trade! Review – you will always need to review your research findings before you buy. Most people just research and grab the first penny stock pick that looks promising.  They are in a hurry… don’t be! Before you buy, you need to give yourself the opportunity to review for value, momentum, Fibonacci position (or whatever your preferred analysis technique(s) might be) and, especially, for other opportunities. Not doing that is a sure prescription for a stock market loss. And, finally the 3′d “R,” Reflection – You will always need to reflect on what you found in the first two “R’s”. This is where a good part of the “HJ-Factor”… The Human Judgment Factor enters the equation… Without it, your success will melt-down like an un-cooled nuclear reactor and so will your bank account along with it.  If your intuition (not your fear!) say “NO,” then don’t! Of all the things that a beginning investor/trader needs to do to be successful, the two that I believe most people will have trouble with are Research and Timing.  To be honest, I haven’t always had time to do the research and get the timing right for the Penny Stocks that I’m interested in, even though they can be incredibly profitable. (Anyone else up for a 1,000% profit in a day or two?)
Personally, I joined an advisory service that has a reasonable, 1-time up-front fee of less than $100 USD and no monthly payments. The service gives me a more than adequate workup on the trades that they recommend.  And that means that I have all the information that I need to decide whether I want to do the trade.  And, they tell me when to “buy in”… So, I have the timing too.  I think it’s pretty sweet!
The advisory service that I use is called Penny Stock Prophet.  I’ve used them for almost a year now and I am very satisfied with their recommendations.  I recently did an actual study of their recommendations and I was pleasantly surprised to discover that over 80% of their recommended trades were profitable.

And, Here’s My Bonus Package
If you buy a membership in Penny Stock Prophet I have a bonus package that I wrote (I really did… no outsourcing or PLR was used… Just my 30+ years of experience trading financial markets) for you which will definitely help you jump start your new Penny Stock trading career…
… First, I personally answer 5 of the most pressing questions about Penny Stocks shared by many beginning and intermediate investors and traders alike… Bonus #1 is a laser-targeted, 10-page Penny Stock e-book to help you get started right.
Bonus #1 – 5 Essential Questions About Penny Stocks e-Book
Many traditional investors just plain don’t understand the ins and outs of penny stocks. This compact e-book answers the following 5 questions that many, if not all, investors new to the penny stock markets and trading will probably have:
“What Is Penny Stock Investing?”“Can You Really Get Rich Using Penny Stock Investing Strategies?”“What Makes a Penny Stock Attractive?”“Do Low Prices Mean Low Risks with Penny Stock Investing?”“When Should I Cash Out on My Penny Stock Investment?”Don’t let the small size of this e-Book fool you! There are 1 to 3 pages per question and there is no fluff. This is an essential, introductory e-book… Don’t let it slip through your fingers…
Bonus #2 – “The 3-R’s of Stock Market Investing.” An’ they ain’t “Reedin’, ‘Ritin’ nor ‘Ritmetic”… It’s short and sweet… It’s just 1 page and may be the most important freebie that you’ll ever get.
Bonus #3 – My 3-part article series “How to Use Penny Stock Prophet To Make More Money!” as a single, easy-to-read PDF. Discover WHY I think that Penny Stocks are a great way to go and how I think you should use the Penny Stock Prophet’s information to make money. It’s delivered via e-Mail right to your door step, so to speak, just as soon as I get a copy of your ClickBank receipt in my inbox (see below).
OK, if you are still reading this I expect that you’re ready to get started.  So, how do you do that?
Here’s How:
In order to receive my Bonus Package, all you need to do is this (takes less than 2 minutes):
Step #1: Buy your membership in Penny Stock Prophet.  Remember to make sure that at the bottom of your ClickBank Order Page it says [Affiliate = alfonzoz01]; alfonzoz01 is my ClickBank affiliate ID for this offer.  If you buy using another affiliate ID you will not receive my Bonus Package.
Step #2: Send a copy of your ClickBank order receipt to AlPhillips@PennyStockProphetSuccess.com and I’ll personally see to it that you are sent your bonus package right away.
The offer has a 60-Day, Full Purchase Price Money Back Guarantee administered by ClickBank so you know for sure that you will get your money back no matter what your reason if you are within the 60 guarantee period.
And, if you decide that your purchase isn’t right for you just request your full refund from ClickBank. But, if you do that, please keep my Bonus Package as my way of saying “Thank You For Giving It A Try!”
Thanks for checking out “Want To Start Trading Penny Stocks And Make Money Consistently.”
Go Forth, Make A Fortune,
Al

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Goldman is Wrong About Cryptos Going to Zero

Cryptos

Goldman has done it once again. Another round of FUD has been unleashed, as they claim that most if not all cryptos will go to zero. Here’s our reaction to their investor note.

Recently, Steve Strongin, head of Goldman Sachs global investment research, released a note to investors that was picked up by the media. In this note, Goldman stated that most, if not all, cryptocurrencies will likely go to zero, since they have no intrinsic value and the crypto market is not rational. This decidedly negative tone is nothing new for Goldman as they stated in October last year that Bitcoin is not the new gold. Coming off the heels of a steep early February crash, this provocative message is likely to spook a few investors. Let’s take a deeper dive into Goldman’s reasoning.

Survival of the Fittest?

Even the most hardcore blockchain enthusiasts have been surprised at the plethora of altcoins that have entered the market and garnered sky-high valuations relative to their usefulness to society. Coins like Dentacoin (a cryptocurrency for dentists) and Dogecoin (literally a meme cryptocurrency) have managed to exceed the market cap of many large companies. Although there are quite a few promising altcoins, they are vastly outnumbered by projects that are driven by pure speculation.

In Goldman’s note, they liken the current crypto boom to the late 90s internet bubble. If that is the case, then there are many examples of the next Pets.com. Most in the cryptocurrency community would agree with Goldman in this respect. The pure monkey-dart FOMO (“fear of missing out”) approach of late 2017 must be replaced by careful selection of coins with groundbreaking technology and partnerships with established businesses. It should come as no surprise that many of the vaporware and literal ponzi scheme coins will eventually die out.

Cryptos BTC

No Intrinsic Value?

Another point in the Goldman note was that Bitcoin and other cryptocurrencies have no intrinsic value. While this may be an effective argument for equities, it doesn’t explain why we assign such high value to chunks of metal like gold bars. Furthermore, while the first generation of coins like Bitcoin serve primarily as stores of value or forms of transaction, the next generations of coins, like Ethereum and beyond, serve as platforms upon which smart contracts and decentralized apps are built. In our opinion, the usefulness of cryptocurrencies is perhaps limited in scope, but the possibilities for blockchain technology are endless.

Any place where databases are used, like logistics, supply chain, even medical records, are slowly but surely exploring and adopting blockchain technology. The ability to store immutable records on a ledger that can be easily accessed has endless applications. In this respect, the moniker cryptocurrency is a misnomer these days, as blockchain can be thought of as more of an ecosystem for a variety of applications than merely a currency. It should come as no surprise why titans of industry like IBM (IBM), Amazon (NASDAQ:AMZN), and Disney (DIS) have devoted resources to invest in blockchain or even develop their own proprietary blockchains.

Irrational Market

Goldman writes that the cryptocurrency market behaves irrationally because all coins tend to move in the same direction at once. Most crypto investors would agree that this is a problem, as one bad day for Bitcoin can spell disaster for the whole market. However, there is a simple reason why this is the case: most altcoin crypto exchanges offer only a few trading pairs, so you have to use a “big name” crypto like Bitcoin and Ethereum to buy altcoins. There are only a few fiat to crypto gateways, but most altcoins rely on Bitcoin or Ethereum markets. Thus, it should come as no surprise that coins are correlated. The advent of decentralized exchanges and more coins getting fiat pairings should help alleviate this issue.

The final Goldman point is a common one among crypto critics. Basically, the question is: what’s stopping anyone from creating a cryptocurrency and entering the market? It seems that there are almost no barriers to entry and that coins with very little utility can be listed on exchanges and command high market caps. Although it is true that barriers to entry are minimal, it is actually extremely difficult to crack the very top of the market. The coins in the top 10 in market cap have weathered multiple downturns, hostile attacks from hackers, and threats of government bans to gain significant adoption and show promises of extensive use cases.

We have formulated a metric to gauge the concentration in the cryptocurrency market called CCI.

This metric shows that there is a very high proportion of market share captured by a few of the top coins. While new coins are hitting the market and grabbing headlines for their high market cap to utility ratio, the vast majority of value is still being assigned to the ‘blue chip’ cryptos. In fact, if we apply this same calculation to the constituents of NASDAQ, we get a concentration score of around 40%. This suggests that crypto is even more concentrated than the stock market and not just a grab bag of coins being assigned random values.

Although there is a downward trend in the CCI and we expect this trend to continue in the short-term, we think that eventually there will be reversal of this trend, as coins with superior technology and ‘killer apps’ are uncovered and dominate the market. This goes back to the point of doing research and thinking about the technology and applications of coins, rather than hopping on the latest trending coin.

Conclusion

Goldman’s note to investors was not unwarranted, as even crypto enthusiasts would agree with their assessments of problems in the space, particularly the prevalence of altcoins with little utility and the high degree of correlation between coins. However, overall, Goldman is still viewing cryptocurrencies as a store of value and missing some of the very exciting applications that are possible with the blockchain technology that provide real-world value. In addition, Goldman is dismissing the market as completely irrational, whereas it is actually quite efficient in allocation of value to the top projects.

We believe in the long-term future of blockchain technology and have already begun to see some very exciting applications of it. We caution investors to do extensive research before investing in any coin and encourage investors to find projects that have solid use cases. Many of the coins that hit the market may indeed fall to zero once the hype dies down, but there will be coins that not only survive, but prosper.

If you found this article helpful, please follow up for the latest updates. If you have any questions or comments, we would love to hear from you. Let’s discuss in the comment section below!

How to Make Money with Penny Stocks?

penny-stocks-watchlist

In many believes penny stocks are supposed to be the best and most explosive way to make money quickly. When anybody speaks about penny stock actually he speaks about those stocks whose are traded under the rate of five dollars per share. Making money with penny stocks is never easy as it requires many assessments and cool monitoring. It is similar of normal shading of stocks in many ways. The investment in a penny stock is always risky and hazardous. Here the rise of stock price may become bull again; the downward trends also can be dangerous. Without acquiring proper knowledge no one should invest in penny stocks. Always make maximum of your efforts to pick a perfect stock. Never walk with rumors. Again, never be casual while selling. Pick a good broker who allows you more flexibility. Try to break the issue of the middleman. Avoid buying those penny stocks whose are overvalued or highly focused by media. If any penny stock is highly focused with media or maximum peoples, better to get away from it. Always keep that in mind, that big fishes make mane airy news while counting profit and to make the others looser. You need to know it clear about the prospect of a penny stock. Yes, it’s true that for the penny stocks it is harder to guess the future of a company. But try your best to be ahead from others, and that is what you always can do. Fundamental evaluation while buying a share is very important. Remember, you can make even three hundred percents of profit by investing in penny stocks. In one month period if you can get a profit range of five percent you can make you out.  You can do penny stock business both in online and offline strategy. Your first work is to find out a good broker with may suit with you most. If you can, I would say your job is half done. Make everything clear to your broker about your contact details and also about how much you can afford for a primary investment procedure. There are two terms of trading mostly used. These two terms are asking price and bid price. You will see a gap between these two prices. That margin of gap is the gain of your broker.

penny-stocks-to-watch

OTCBB is the main monitor of penny shares. If you are an expert in normal trading of shares in a capital market it will help you a lot in case of investing in penny stocks. Excess buying and selling is never recommended for a penny stock businessman. Never think penny stock business is for the peoples whose didn’t get too much money. Rather it is better to the bulk investors. If you didn’t have so much money but have intelligence, then you can go for penny stock business for a quick profit making but you should not hesitate while dealing with business matters.

To make money in penny stock business the most important thing is to identify and catch the point of exit. There is a proverb about stocks saying, ‘‘until you sell, you are yet to make profit.’’ This is a very true thing. If you didn’t conceive the loss or profit, then all transaction cannot bring any good for you. These all things will remain virtual at then. One thing is very much suggested to make profit while buying penny stocks. It is, always try to buy penny stocks in huge volume and never buy in short volume. In some cases many people forgot to maintain these things. If you want to take position in a particular penny share, you must to buy in huge volume every day. Never react with traditional or ongoing buy or sell signal. If you do so, it would cause you severe damage. A well diversified port folio can minimize your hazards a lot. So to make money doing business with penny stocks, make your port folio well diversified. This diversification is not based on only category wise, but also sector wise. An educated and experienced penny stake holder can easily guess and read the upcoming of a particular stock. F you are a beginner, never get panicked. You can find plenty of penny stocks related books and guides abundant in your local market. If those books are not enough for you than go for an expert on it. But remember, in case of expert choosing you also need to be cautious. The businesses of stocks are really risky and in case of penny stocks this risk factor becomes maximum. So, whatever you may do to make money quick while penny stocks dealings, do carefully with full attention and also with professionalism. Finally, I would say, go fast, react fast with the market and conceive profits in no time, and that should be your motto while dealing with penny stocks.