Why Panic ?

Everywhere you go, whether it’s a Little League game or a cookout, people are whining and moaning about the market. It is especially true of the casual investor. Many of this group is also predicting some sort of crash or sharp fall in the market in the near term. My memory tells me that some of these same people were very upbeat during the monster tech rally of the late 1990′s. Others in this group also felt comfortable buying stocks and mutual funds when the market already rallied off of the bottom during our last big decline in 2009.

So what is this telling us ? It obviously shows that people are scared. It has become evident on the OTCBB, where with the exception of a few hot penny stocks, the volume has been weak at best. A stock like Distribution Management Services (DMGM.PK) may have risen more than 75% yesterday, but many other stocks recommended by some of the top penny stock newsletters traded relatively light volume. In other words you have had to be spot on to make money on the long side in this market.

On the large cap side there is a better rationale for the weak volume. Every year people are somehow baffled when the action is light in August. Did I miss something. Did PM’s and hedge fund traders all of a sudden stop vacationing in the late summer. Vacation isn’t the whole reason for the tepid trading, but it has certainly contributed to the absence of buyers.

On the other hand, major corporations are doing the exact opposite. Stock buybacks are happening on a frequent basis and M&A activity is already above the rate of the prior two years. Just keep in mind that if S&P 500 companies are willing to invest at these levels things probably are not as bad as they seem.

Penny Stocks and Low Volume Markets is news brought to you by Penny Stock Explosion. We provide up to date current information for hot penny stocks and penny stocks which are primed for explosion.

Related posts:

1. Penny Stocks Typically in America many sports fan are not only skeptical...
2. Penny Stock Liquidity You have probably heard the old saying, "Sell in May...

Related posts brought to you by Yet Another Related Posts Plugin.

Does it Make Sense ?

Yesterday U.S. markets traded down and world markets followed suit this morning. Both traders and investors are awaiting Fed Chairman Ben Bernanke’s speech from Jackson Hole. This will surely be the catalyst for Friday’s trading and tape action should be volatile

Now there are different ways to approach buying before the Fed Chairman speaks. It is probably safe to say that Mr. Bernanke has usually been clearer with his words than his predecessor Alan Greenspan. But the problem remains trying to anticipate what their message is. Experience tells me that is a losing battle unless you have a crystal ball. Trying to go either long or short before such an important speech tend not to work because of the choppiness of the market. Many traders get stopped out and then have to watch their former position trade to their initial profit target. Without them in it.

Now you have read recent blogs here about takeovers and market bottoms. However, those market trends apply to investors not traders. For instance, if you had an urge to buy a penny stock like China BTC Pharmacy (OTCBB: CNBI.OB) in the 4 dollar range as a long term hold, it may or may not be wise. However, if you had a 2-3 year window and a price target of 10, a fluctuation of 40 or 50 cents really isn’t an issue. On the other hand, if you were buying this micro-cap name as a momentum play for a short term pop, you often are gambling on Bernanke and market direction. Yes, hot penny stocks sometimes do trade in sympathy with the broader markets.

The age old question of trading before Bernanke especially applies to large cap names, which are obviously more sensitive to the Fed, than OTCBB stocks. But the same philosophy applies. If you are comfortable buying a name like Bank of America (NYSE: BAC) and have a long term investment philosophy,by all means buy the stock. But if you are a short term trader, you must remember that many good ideas turn into losses when the Fed is involved. This is why it is often best, to put the trading ideas on hold. Being impatient in the market is often a recipe for disaster.

Buying Before Bernanke is news brought to you by Penny Stock Explosion. We provide up to date current information for hot penny stocks and penny stocks which are primed for explosion.

No related posts.

Related posts brought to you by Yet Another Related Posts Plugin.

What Do They Mean to the Market?

As we have mentioned many times in previous blogs, takeover fever is back. Potash and McAfee lead the headlines and HP jumped right over Dell’s previous bid for 3Par. The common denominator in all of these deals and for that matter proposed deals, was the cash takeover.

Many companies often prefer to acquire other corporations in stock deals. Basically, the prospective buyer uses their own stock as currency in the transaction. This is often done because the acquiring company often feels that their stock is either fully valued or inflated. This past few deals have been different because the premium paid was all cash. Potentially signaling to the market that the acquirer feels that there own companies share price is too cheap.

Now this seems to be a positive for the market because if S&P 500 companies would rather part with cash, this tells us they are confident going forward. Small and microcap stocks often don’t have the luxury of large cash positions and have no other choice other than using stock to make these deals. For example, even the most promising microcap or penny stock, usually uses a rising stock price to for buyouts. Simply because they are growth stories with little cash. However, the big boys can do either. Hopefully this vote of confidence will trickle down from the NYSE to the OTCBB.

So if you ever see a penny stock participate in an all cash buyout, you are getting a signal from management that things are good. Most times reading signs from companies is much more accurate than trading reports, brokerage analysts or penny stock newsletters. But, you have to sometimes read between the lines. So do your home work and prepare your large cap and penny stock lists.

Cash Takeovers is news brought to you by Penny Stock Explosion. We provide up to date current information for hot penny stocks and penny stocks which are primed for explosion.

Related posts:

1. Potash Rejects All Cash Bid Traders who were long the Ag space woke up Tuesday...

Related posts brought to you by Yet Another Related Posts Plugin.

Is Another Republican Revolution on its way?

Many political pundits and pollsters expect the Republicans to at least take back the house, and possible the senate this November. Some are even calling for a repeat of the “Republican Revolution” that happened in 1994, where republicans steamrolled the democrats with anti-Clinton fervor. However, some say this drove the left leaning Clinton administration to the middle and set the groundwork for the historic market rally of the late 1990′s.

Could a republican house move Obama to the center ? In theory, yes. Recently, Obama has had problems getting his own party on board to vote on key issues, especially moderate to conservative democrats in swing states or conservative voting districts.. He has often relied on picking off the few remaining northeast republican left to pass bills. A republican victory in either the house or senate would halt many of Obama’s iniatiatives, which much of Wall St. calls big goverment programs. This may bode well for large caps and even penny stocks.

Many also can remember that the republicans at times held both the house and senate under President George W. Bush. That period led to a major downturn in the market that most of us still remember. This is why historically, the market has done better when we have gridlock in Washington. It doesn’t matter whether the democrats or republicans are running things, Wall St. essentially likes neither party to make the decisions.

Many experts feel that the market will rally if the democrats lose the house. Generally, there are specific sectors to watch when a political event happens. This is different, in the late 1990′s, technology stocks outperformed the stodgy old blue chips, but those blue chip names like General Electric (NYSE: GE) still did well. In other words, gridlock leads to broad based rallies and investors who are up in there core stock and mutual fund positions tend to become traders when they have gains. This could lead to the emergence of several hot penny stocks on the OTCBB.

Right now it is too early to tell which microcaps will emerge if the gridlock theory comes to fruition. But it is never too early to prepare. Right now is a great time to research this theory and you have until November to do so. As of now just scan the internet, watch cable news and read as many large cap and penny stock newsletters as you can find. Remember to stay tuned to our blogs and penny stock alerts, because being informed is the key.

Will Gridlock in Washington Help the Market? is news brought to you by Penny Stock Explosion. We provide up to date current information for hot penny stocks and penny stocks which are primed for explosion.

No related posts.

Related posts brought to you by Yet Another Related Posts Plugin.

Penny Stock Trading

Many people are attracted to penny stocks because of their potential to provide massive gains. However, many novice traders and investors often get involve in speculative investments without having a strategy set in advance.

People often look to buy hot penny stocks because of their low price and the ability to own large share amounts with only a small amount of capital. Penny stock buyers should know that trading strategies should be the same, regardless if you are buying Cisco Systems (NASDAQ:CSCO) or a mining stock on the OTCBB. The amount of capital is irrelevant, because you should have an entry and exit plan on every trade. Remember it doesn’t matter whether you invest 3k or 50k.

Please keep in mind that not just any trading concept will work. Sometimes having no plan might be just as good as having no plan at all. So here are some simple suggestions that should keep you out of trouble and hopefully be cornerstones in your thought process.

Always trade small until you achieve a certain comfort level. Being comfortable as an investor is being consistently profitable. So take your time, good ideas come around all the time. CNBC, the Wall St. Journal and various trading and penny stock newsletters have winning trades often. So don’t be afraid to miss one before you gain the necessary experience. Trust me other good ideas will come again.

Another common mistake made by traders and investors is using margin. In my opinion, trading on margin is not only extremely risky because you can actually lose more than you initially invested, but it also alters your mental psyche during the trade. So never put a stock like General Electric (NYSE:GE) on margin to buy a penny stock. No matter how good it sounds.

You should also look for solid companies. While it is not common for a company trading on the OTCBB to be profitable, you can look for other signs. Start with looking for companies with revenues or contracts. Especially companies that have aligned themselves with major corporations or governments. This often validates a companies prospects.

Finding liquid penny stocks can also be somewhat difficult. It is human nature to want to be first and buy a stock while everyone else is sleeping. But this is usually a losing game. A simple rule to use is to never invest more than half of the average dollar volume that a stock trades. For instance if a $1 stock only trades 10 thousand dollars in volume on average, don’t buy more 5 thousand dollars worth. Novice investors don’t realize that small orders can move some illiquid penny stock names 5% with ease. This is part of building an both an entry and exit strategy. Not using market orders is the best way to avoid getting a bad execution.

The last point is another common mistake to avoid. Don’t buy stocks that gap up. Many professional traders and hedge fund managers “fade” or counter trade gaps. Market makers have made fortunes short selling capitulation moves to the upside in penny stocks. Think about the last time you bought a gap up and the stock went down quickly. Did you ever stop to think of who was on the other end of the trade ? Why do you think these trading firms are in business ? To lose money. So if you really like a stock that gaps up, put a limit order in below and wait for it to retrace.

Lastly, do your research. We always tell you to be prepared. Having knowledge about a company is not a guarantee to a profit, but it surely eliminates bad investments. The internet has leveled the playing field between retail and institutions to some degree. So take the extra hour and simply browse the web for PR’s and financials. Remember, preparation is a key to avoiding rash decisions.

Penny Stocks – Why You Should Start Small is news brought to you by Penny Stock Explosion. We provide up to date current information for hot penny stocks and penny stocks which are primed for explosion.

No related posts.

Related posts brought to you by Yet Another Related Posts Plugin.

China’s Real Estate Bubble

Chinese stocks fell last night to the tune of slightly less than 3%. At this point many think that the world’s third largest economy may finally be ready to roll over. There have been many opinions on China eventually having a real estate bubble. Others feel their demand for commodities will fall. In theory this shouldn’t bode well for world markets, and especially the NYSE and NASDAQ.

However, we have all heard this boom bust story regarding China before. Investors may see not hot penny stocks like returns in Chinese stocks, but history has shown us that it’s usually near the bottom when the media is calling for a crash. We are not saying to take a contrarian attitude and go long Chinese equities, but take the bad news with a grain of salt.

The main concern with China in regard to U.S. stocks has to do with inflation. China’s inflationary fears certainly impact the FOMC’s policy making. Our markets have seen this situation before and Bernanke has pulled us through.

Now how does this impact the OTCBB ? Well, you can look at it two ways. First, the negative sentiment coming out of China will make it difficult for massive short term gains in Chinese Bulletin stocks that trade on the Pink Sheets or Bulletin Board. Penny stock traders often look for momentum and any type of breakout or rally might rare these days with the current news flow out of Beijing.

The second way to look a China from a OTCBB standpoint is a positive one, and it’s a longer term view. Many Chinese stocks trading in the United States are at or near lows. Does this create a buying opportunity ? Maybe. For instance former high fliers like Amico Games Corp. (AMCG.OB) and China Infrastructure Investment (CIIC.OB) are at their lows. We are by no means recommending these two names, but we are pointing out that value may exist in Chinese microcaps. So start forming a penny stock list made of China plays and research them. Odds are that most are at lows and a buy low sell high opportunity might be there. After your list is formed, monitor the Asian markets. If a turn is near, value buyers may take a chance in Chinese large caps and it may trickle down to the OTCBB. Once again, don’t jump in immediately, but be ready and prepared.

Will China Slow Down the US? is news brought to you by Penny Stock Explosion. We provide up to date current information for hot penny stocks and penny stocks which are primed for explosion.

Related posts:

1. Will China Effect Small Caps and Penny Stocks? As we all know there is a ton of uncertainty...
2. Could the Yuan Effect Penny Stocks ? Right now we are actually in uncharted territory. China has...

Related posts brought to you by Yet Another Related Posts Plugin.

A Penny Stocks Value

Not so long ago, hedge funds and traders made massive gains by going long commodity stocks and shorting the U.S. dollar. The trade became very crowded and finally reversed. However, at the tail end of that trade commodity stocks like Newmont Mining (NYSE:NEM) and Potash (NYSE:POT) trading near or at highs. Right now, the dollar is very weak and most commodity stocks are in the middle of a trading range.

This condition of the dollar could provide trading opportunities. Not only in the large cap commodity based stocks, but with OTCBB mining penny stocks as well. Most gold bugs have the mentality that gold is the currency of last resort and site limited demand issues in their analysis. Their mentality often causes them never to take profits and lose hard earned gains.

By no means are we saying to buy and hold gold penny stocks for 5 or 10 years. Mainly because commodities often trade in cycles and in this environment, a bird in hand is often better than two in the bush. We are simply suggesting that a rally in large cap gold stocks could trickle down, even to stocks on the Pink Sheets. For instance, if we see a major rally in the mid and large cap mining stocks, common sense says that investors may take a look at a micro-cap name trading under $1 too.

For now, monitor the news flow on the weak dollar and watch how other gold stocks and gold ETF (GLD:NYSE) reacts to the news. Then form a penny stock list that contains your favorite mining plays. Then if your ready, act quickly. This trend may not last long, so take your profits. Recently, we highlighted Gold American Mining Corp. (OTCBB:SILA) and you may see more mining ideas from us shortly.

Does a Cheap US Dollar Make Penny Stocks Look Cheap? is news brought to you by Penny Stock Explosion. We provide up to date current information for hot penny stocks and penny stocks which are primed for explosion.

Related posts:

1. Will These Mining Stocks Drive the Penny Stocks? Recently we have seen a rally in copper prices, which...
2. Could the Yuan Effect Penny Stocks ? Right now we are actually in uncharted territory. China has...
3. S&P 500: Breakout or Breakdown? This week, with the exception of US Steel (NYSE:X) and...

Related posts brought to you by Yet Another Related Posts Plugin.

Will FCX and Copper Propel the Penny Stock Market?

Recently we have seen a rally in copper prices, which historically indicates a rally for U.S. equities. Freeport MacMoran Copper and Gold (NYSE:FCX) has come back into favor and has always been a darling of short term traders and hedge fund managers. FCX is one of the few NYSE stocks that moves like a penny stock. Keep in mind that FCX could have a massive move in either direction. The optimism in copper prices last week leads some investors to go long equities. At this point FCX is a good of a barometer for the direction of the market as you can find.

Now if copper continues to rally the S&P 500 could close above 1120. The 1120 range is very important because there is an opinion in some circles that a break of this number will cause massive short covering. A break to the upside should spur some action in not only copper penny stocks, but to many quality OTCBB stocks as well. Now is the time to start getting prepared. One route is to start reading different news stories and compiling a penny stock list and a large cap list. Also, check out penny stock newsletters that have recommended copper and mining stocks in the past. Then break down these stocks into your top ideas. For instance, most traders are familiar with FCX, but don’t know that Southern Copper (NYSE:SCCO) and Encore Wire Corp. (NASDAQ:WIRE) move on copper prices too.

Gold stocks have been beaten up recently but have stabilized due to weakness in the dollar. So while gold and silver penny stocks may rally too, they may play second fiddle to copper related stocks for a brief period. Wheat has also rallied sharply based on the Russian drought. The stars seem to be aligned with the commodity stocks, but this market has provided us with multiple head fakes. So due your research and consider playing some low priced commodity stocks if they make sense for your portfolio.

Will These Mining Stocks Drive the Penny Stocks? is news brought to you by Penny Stock Explosion. We provide up to date current information for hot penny stocks and penny stocks which are primed for explosion.

Related posts:

1. Penny Mining Stocks – Lithium Penny Stocks are Winners Lithium is going to be in the news in a...
2. Could the Yuan Effect Penny Stocks ? Right now we are actually in uncharted territory. China has...

Related posts brought to you by Yet Another Related Posts Plugin.

Fed Ex Issues Positive Guidance

Last Friday was an important day for the stock market. The S&P 500, which happens to be the benchmark index for U.S. equities closed above 1100. This morning we were also met with positive earnings from market bell weather, Fed Ex (NYSE:FDX). More importantly, Fed Ex issued positive guidance. This news has the pundits talking about a rally to 1150. Fed Ex has often been a great indicator of the economy and this may give bulls a little more courage. We may also see some of the money come of the sidelines due to the fear of being under invested.

Now we have seen many false starts on rallies recently, but considering that FDX’s competitor United Parcel Service (NYSE:UPS) also had good numbers, this rally might be for real. As mentioned above, many bulls are calling for 1150 on the S&P, but there is a patch of resistance above in the 1115 area. Skeptics also say we could have a re-tracement to 1040. However, right now it looks as if the sentiment is changing to positive.

How does this impact penny stocks ? We always mention on this blog that it’s easier to find hot penny stocks in bull markets. Just from the mere fact that investors are more willing to speculate when they have gains and feel good about there portfolio in general. The positive sentiment leads other penny stock newsletters to be more bullish as well. The best way to play this out is to look for a close above 1115 on the S&P 500 before getting aggressive. In addition to picking your favorite large caps, compile a penny stock list too. Past history has shown us that a rising tide can lift all boats. Just remember to invest accordingly, limit your losses and always save some liquidity.

Will Fed Ex Deliver for Penny Stocks? is news brought to you by Penny Stock Explosion. We provide up to date current information for hot penny stocks and penny stocks which are primed for explosion.

No related posts.

Related posts brought to you by Yet Another Related Posts Plugin.

Small Caps Will Lead The Way Before Blue Chips Do!

The demand for foreign-made cars, computers and clothing widened the U.S. trade deficit for the month of May.  This is the highest level in 18 months.

The trade deficit increased 4.8% to $42.3 billion.  This is the largest imbalance since November of 2008. American exports of goods and services rose 2.4% while imports rose 2.9% and outpaced them by .5%.

American manufacturing has been outperforming other industries and benefiting from a global economic recovery. But the concern is that export sales will be hurt by the European debt crisis.  The Dow collapsed when Greece was downgraded but yet it held up strongly against the Portugal downgrade.

Through May, the U.S. trade deficit is running at an annual rate of $474.8 billion, up by 26.6% from the 2009 deficit of $374.9 billion. That was the lowest annual trade gap since 2001.  Ironically the country was in a recession as well that year.

The rise in the May deficit came even though oil imports had dropped by 9.1% to $27.6 billion.  We saw both the price of oil and the volume of shipments decline.

The deficit with China rose to $22.3 billion.  This is a 15.4% spike from the April deficit. So far this year, the U.S. deficit with China, the largest imbalance with any individual country, is up 10.2% from the same period a year ago.  Many bankers and currency traders feel that the Chinese Yuan is grossly undervalued by almost 50%.

How does this affect small caps and penny stocks?  There is no set formula to the markets.  You often hear that when gold is up, the dollar is down or the market is down gold is up etc.  This is not always the case.  Let’s take your typical investor.  He may have purchased a few hundred shares of British Petroleum (BP) for his retirement account.  In the meantime he may have a few thousand dollars of speculative money that he is willing to risk on a speculative investment such as  hot penny stocks.  He is more inclined to sink that money in penny stocks if his investment in BP is doing well.  The whole Dow got crushed until recently and people who thought their money was safe in Blue Chip companies were severely damaged.  Multiply this by millions of people and we have a dilemma.  This takes away from speculative investments.

The general rule of thumb is that small caps lead the blue chips out of recession by a year.  Who knows if that rule will hold true.  The fact is that you can always find a penny stock that has doubled in a day…. The trick is finding it before it has doubled.

Penny Stocks Double In Any Market Condition is news brought to you by Penny Stock Explosion. We provide up to date current information for hot penny stocks and penny stocks which are primed for explosion.

Related posts:

1. Trading Gold On Market Fears When the world is in financial turmoil and currencies are...

Related posts brought to you by Yet Another Related Posts Plugin.

Does the World Cup give Penny Stocks the Boot?

Typically in America many sports fan are not only skeptical of the World Cup, but of soccer in general. However, in Europe and most of the world it’s a blue chip sport. To some it’s the only sport. Consequently, dominating foreign news headlines and European interest. But it’s over on Sunday. What’s the next hot news cycle in Europe? I’d say the European bank stress test results which are due out in roughly two weeks. The US markets have gone through this once and these tests provided a lot of uncertainty to our markets.

Now does this filter down from the FTSE and NYSE to the OTCBB? It could for one reason. That reason is called liquidity. Summer volume is typically low already and the pending stress test results will most likely get lots of play on CNBC, FOX Business News, etc. Now what that means to the retail investor who plays penny stocks is simple. In times of uncertainty, he usually buys less if at all. Penny stock traders may be able to take advantage of this uncertainty on the other hand. Investors could be waiting for companies that were once hot penny stocks to wash out to a cheap level if the stress tests wreck the market. On the other hand, the results of these banks could already be factored in and we could see a flat market.

Unemployment rates in Portugal, Ireland and Spain are already at or near historic highs. The news may be already baked into the cake. So be ready as always. If we do see a sharp correction some quality penny stocks could dip and give you an opportunity to profit in a fast trade based on somebody else’s weakness. So have your penny stock list locked and loaded and always be ready to pull the trigger if it makes sense.

Penny Stocks is news brought to you by Penny Stock Explosion. We provide up to date current information for hot penny stocks and penny stocks which are primed for explosion.

No related posts.

Related posts brought to you by Yet Another Related Posts Plugin.

Dog Days of Summer for IPO Market ?

Many of you know, from previous entries that the Tesla IPO (NASDAQ:TSLA) was a wild ride and offered huge gains to many who bought in the aftermarket. However, this week is no different from years past. Using the word slow is an understatement. Consequently, Fortune Bank IPO (NASDAQ:FBBC) is the only new issue scheduled to trade this week. The outlook for the deal is a mild premium and in no way can be confused with Tesla Motors Inc which provided many with the volatility and excitement that you can find in penny stocks. Next week will be a little more active with three deals scheduled to price. Business software company, Qlik Technologies IPO (NASDAQ:QLIK) is thought by some to trade at a decent premium.  Real ID (NYSE:RLD) is also expected to trade at a  nice premium.

The remaining IPO on the syndicate calendar is the Canadian company Smart Technologies IPO (NASDAQ:SMT) which IPO services say may trade at a small premium. Keep in mind that Tesla traded higher on a big down day in the market. While you never know how new issues will trade, quality offering can still trade at premiums in bad markets. The best thing to do is form a list and be prepared. It doesn’t matter whether your investing in an IPO list or a penny. Being prepared to act is the key. Remember there is an Tesla aftermarket buyer who was filled @ 17.54. That buyer had the opportunity to sell the stock over $30 the next day. Now that is a massive gain! I think it’s safe to say that some of those Tesla aftermarket buyers did their homework.  IPO’s and penny stocks can offer huge gains and we are always looking for the next huge winner.

IPO Market is news brought to you by Penny Stock Explosion. We provide up to date current information for hot penny stocks and penny stocks which are primed for explosion.

Related posts:

1. Tesla Price NASDAQ:TSLA Putting On The Brakes TSLA is a company that has a great CEO, a...
2. Tesla IPO and OTC:ELCR The much anticipated Tesla Motors IPO will begin trading on...

Related posts brought to you by Yet Another Related Posts Plugin.

Tesla IPO and Its Wild Ride

Going into the long weekend, it seems that shares of Tesla (NASDAQ:TSLA) have come back to earth. IPO shares of TSLA were priced at $17 and surged to 30.42 on it’s second day of trading. A massive gain considering that traders had time to buy aftermarket shares under $18. Was a lesson learned here for investors who paid more than $25 ? Yes, I think so.

TSLA is a company that has a great CEO, a cutting edge product and has never had problems raising money despite being unprofitable. However, the saying “What goes up must come down” came into play on TSLA. It’s probably safe to say that some of the aftermarket buying came from buyers who have a legitimate long term perspective.  These are investors who are investing with a horizon so long that makes paying a point or two higher almost irrelevant. But what was the short term trader thinking at $30 a share ? Buying TLSA for a short term after it’s huge run is a classic example of why it’s sometimes better to sit on your hands. While the company has tremendous potential, the market mechanics remain the same.

It doesn’t matter if it’s a blue chip on the NYSE, a mid-cap or an OTCBB issue. Smart traders will always take profits. The lesson learned here is not to chase stocks that have made huge moves in short time frames. Looking at charts and decreasing volume at the highs is key. This applies not only to TSLA, but to hot penny stocks too that are on the move.

Tesla Price NASDAQ:TSLA Putting On The Brakes is news brought to you by Penny Stock Explosion. We provide up to date current information for hot penny stocks and penny stocks which are primed for explosion.

Related posts:

1. Tesla IPO and OTC:ELCR The much anticipated Tesla Motors IPO will begin trading on...

Related posts brought to you by Yet Another Related Posts Plugin.

iPhone 4

Apple (NASDAQ:AAPL) just announced last weekend that sales of the iPhone 4 had reached 1.7 million units. The launch of the new product was staggering. Now how does the new product impact penny stocks? Stocks on the OTCBB often can do better as a whole if the broader market averages are higher. An investor who looks for hot penny stocks is more apt to speculate if his core holdings (Blue Chips, Mutual Funds etc.) are doing well. Basically higher averages on the NYSE and the NASDAQ usually bring more liquidity into micro cap stocks.

Currently, AAPL is trading about 20 points off of it’s all time high and the shares have pulled back sharply in the last few trading sessions. Many major brokerage firms have price targets on the stock that would provide massive gains if they were met. If the brokerage firms are right in their analysis, smaller stocks could benefit.  As mentioned before in prior blogs, many penny stocks try to attach themselves to AAPL by announcing new Apps.  There are dozens of companies that are constantly receiving revenues from larger companies like AAPL, GOOG and RIMM.

Sometimes this works and sometimes it doesn’t. Many large cap names that make parts for the iPhone 4 are also sensitive in a different way. The movement of these names is more earnings related. Going forward, keep your eye on the sales updates from AAPL. There might be a trading opportunity in a penny stock that was previously idle or even dead. Look at the gaming and social media companies in particular. Being ready is the key and if nothing develops, all you have lost is time.

iPhone-4g

Can iPhone 4 Sales Affect Penny Stocks? is news brought to you by Penny Stock Explosion. We provide up to date current information for hot penny stocks and penny stocks which are primed for explosion.

Related posts:

1. How the BP Oil spill affect Penny Stocks We all know that every time there is a worldwide...
2. Fed Interest Rate and Penny Stocks Well, historically small cap and micro cap companies do better...
3. Penny Stocks 2010 – Top 3 Penny Stocks for the first 6 months Today we are recapping three of this year's biggest hot...

Related posts brought to you by Yet Another Related Posts Plugin.

BP Stock Price and the affect of the Oil Spill

We all know that every time there is a worldwide event, investors have a chance to capitalize and make money in the markets, especially when it comes to an environmental disaster.  The news bring a lot of attention to the stock market. It happened with the Exxon Valdez and Katrina. Now it’s happened again with larger companies like British Petroleum (BP), Transocean Ltd (RIG) and Halliburton (HAL) have been punished. Every time an event like this happens, several penny stocks come into play.  Shares of MOPN took off after they received a purchase order from BP for their MOP Maximum Oil Pickup product.

Other penny stocks like EVTN and EVXA also received a large amount of attention from the environmental disaster.  All of these companies instantly became hot penny stocks.  You should throw these three companies on your penny stocks list and keep an eye on them.  Many investors will try to buy familiar names that historically react favorably oil spills. Longer term investors may buy companies like MOPN and EVTN and are hoping for a home run while penny stock flippers and day traders step in and provide constant liquidity.

In the end though only a select few of these names actually benefit from these disasters financially. Only a few contracts are actually given out, so be selective.  Keep in mind that profit might be short lived so be prepared to take a quick scalp. Once again the key is being prepared. You need to know which stocks move based on an event. So have your lists of blue chips, mid-caps and penny stocks ready, and be ready to pull the trigger.

How the BP Oil spill affect Penny Stocks is news brought to you by Penny Stock Explosion. We provide up to date current information for hot penny stocks and penny stocks which are primed for explosion.

No related posts.

Related posts brought to you by Yet Another Related Posts Plugin.

How Will This Effect Penny Stock Trading?

Today the Federal Reserve was once again true to their word. The benchmark interest rate remained unchanged. The FOMC also mentioned that while the U.S. economy is improving, problems in Europe could slow down growth in America.

Many large brokerage firms feel that due to the problems abroad, a rate hike here in the U.S. is unlikely until sometime next year. To me, that sounds like it makes good sense. Now, how does that affect penny stocks and companies that trade on the OTCBB.

Well, historically small cap and micro cap companies do better in low interest rate environments. This is due to the low cost of borrowing and more readily available supplies. But as you have probably read here before, hot penny stocks usually make huge moves based on a positive news release or an event related to the stock. Unlike Intel (INTC) or Disney (DIS), the big percentage gainers on the OTCBB or Pinksheets generally don’t move in sympathy with the S&P 500 or the NASDAQ 100.

Do your homework if you are looking for the next hot penny stock. You will not get a signal from Bernanke or the broader market to find the next penny stocks to watch. Low interest rates don’t hurt, but the biggest winners have come from special situations. Not from the Fed.

Check back for more blog entries and look for our next hot penny stock alert.

Fed Interest Rate and Penny Stocks is news brought to you by Penny Stock Explosion. We provide up to date current information for hot penny stocks and penny stocks which are primed for explosion.

No related posts.

Related posts brought to you by Yet Another Related Posts Plugin.

“Short Squeeze”

Today let’s talk about the penny stock short squeeze.  This is something that happens a lot in the penny stock game.  A short squeeze is definitely more likely to happen in a company with a small market cap and a small float.  It is harder for a company with a billion dollar market cap to move than it is for a company with a $75 million market cap.

This is the simple concept of supply and demand.  When an investor has a short position in a stock it simply means that they are betting that the company is going to decrease in value.  This is not really a long shot with 99% of penny stocks out there!!

When a short squeeze happens in a penny stock, all hell can break loose with the price of the shares.  If there is a large short position in the stock and the price of the stock increases, the shorts may be forced to cover.  They either want to cut their losses or have to fulfill margin requirements.  When the cover the stock, they are actually buying the stock back.  This can make the stock jump even further and trigger off more margin calls and creates more buying.  It is somewhat of a domino effect.

Take a look at any penny stocks that you own and see if they are on this list and how many shares are short compared to the float.

This is a great penny stocks list for potential investors to take a look at.

The Penny Stock Short Squeeze is news brought to you by Penny Stock Explosion. We provide up to date current information for hot penny stocks and penny stocks which are primed for explosion.

No related posts.

Related posts brought to you by Yet Another Related Posts Plugin.

Adding the “Q” to WAMU – From a Blue Chip to a Penny Stock

“Zombie Stocks” Trading as Penny Stocks: WAMUQ , LEHMQ. If you see a “Q” at the end of a stock symbol take it with a grain of salt. And if you do decide to buy the stock, only risk capital that you can afford to lose. As we all know many investors are lured to penny stocks. The hope of a large percentage gain often outweighs the fear of losing money. However, there is a difference between buying hot penny stocks with good prospects and buying a Zombie Stock.

A Zombie stock is generally a company that is near bankruptcy. When the market crashed in 2009 blue chip companies like General Motors, Washington Mutual, Lehman Brothers and AIG filed bankruptcy, causing both retail investors and institutions to take massive losses.

Consequently, these stocks were delisted from the NYSE and traded on the Pink Sheets. They are now classified as “Zombie Stocks“. Now don’t get me wrong there is a niche market for these types of securities. There are investors who flip penny stocks everyday. They move in an out of the stock trying to scalp a 2 to 10% gain. There are also other retail investors who generally are not active penny stock buyers, that will step in on fallen blue chips and view the investment as you would a lottery ticket. Some catalysts for buying Zombie Stocks are massive liquidity and news sensitivity. While most people who engage in this practice eventually lose money, there are some who double, triple or even quadruple their funds in a very short time period. While some view stocks like WAMUQ as a trading paradise, there are probably easier ways to make money in the market.

WAMU Bankruptcy is news brought to you by Penny Stock Explosion. We provide up to date current information for hot penny stocks and penny stocks which are primed for explosion.

No related posts.

Related posts brought to you by Yet Another Related Posts Plugin.