Top Penny Stocks to Buy In a Crowded Market
The stock market is filled with thousands of stocks of every description so finding the top penny stocks can be a challenge. Successful penny stock traders may each use slightly different methods, so it may appear that finding the top penny stocks is a combination of placing your order and sheer luck. However there are some fundamentals that increase your chances of finding top penny stocks in any market.
Educate yourself about penny stocks and penny stock trading. Penny stocks are stocks that offer the potential for huge rewards, but they also carry substantial risks. Know what you’re getting into and be sure that you can handle the excitement and the roller coaster ride.
Know how to control your risk. Be sure to set up losses to limit your exposure. If you decide to hold on to your stock a little longer, you can always move your stop point out in increments.
The top penny stocks are usually those with a growing volume. The best penny stocks for trading are those with good volume because they’re easier to get in and out of. As you prepare to enter a new position, look for signs that the stock is trading with some volume. Stocks trading with a good buying volume can also signal a building upward move.
You’ll find the top penny stocks trading on the OTCBB and Pink Sheets stock exchange. Still, it’s important to know the rules for the market your stock is trading in. Both markets offer excellent opportunities for the small investor to make quick profit strikes.
Understand the basic chart patterns. There are many chart patterns that can help you locate buy and sell indicators when you’re looking for the top penny stocks. This will help you determine your entry and exit point for a particular stock and also help you create a trading strategy to keep you on track.
Greed is good – to a point. If your stock has delivered a solid profit, and you’ve reached your exit point, it may be best to take your money and go. Penny stocks – even the top penny stocks – can move up and down very quickly so keep your risk exposure as low as possible. Never be afraid to lock in your profits.
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