Many day traders have substantial experience trading in the market for penny stocks. Others have little or no experience in the penny stock market, but are aware that it holds some of the greatest potential returns for traders who can pick the right winners.
It is difficult to tell which penny stock firms will be the next Apple, but there are always a few clear winners that should be in every investor’s portfolio.
Right now is a great time to own domestic equities given growing international uncertainties, and small cap stocks have been surging thanks to the implementation of recent tax and regulatory changes.
This overall boost in the market for small cap and penny stocks means that the market’s winner for the next quarter are set to win big and there is little downside potential as the strong climate lifts all boats simultaneously.
This quarter’s penny stock picks are all deep in oversold territory and set for massive clawbacks in value, so let’s take a quick look at the top 3 penny stocks that should be in every investor’s portfolio.
Enphase Energy, Inc. (ENPH)
While ENPH is a long way from its record high of $17.97 posted in September of 2014, this stock is set for a quick rebound if it continues a pattern of short pullbacks followed by steady price surges.
After breaking down to $0.65 in May 2015, it has been steadily climbing back into the $4 to $6 trading range, including a strong bounce in November. This advance is set to continue upward, and any pullbacks toward $5 or less should be seen as a strong buying opportunity before the next big surge in price.
ENPH is a classic example of an oversold stock rapidly clawing back lost value, and it is currently sitting at the perfect range for a low priced buy in before then next rapid surge in price.
Stein Mart, Inc. (SMRT)
SMRT is another great deal waiting to finalize its breakout from oversold territory after a failed one-day surge back in March.
After testing highs in the mid-teens for quarter after quarter from 2013 to 2015, SMRT collapsed to record single digit lows in the small cap bear market. The one-day March resurgence failure was quickly followed by a solid month of steady gains in May that confirmed the analysis that SMRT was on a rapid rebound trajectory from being significantly oversold.
With the price stabilizing above 3$, it is only a matter of time before this penny stock takes its next leg up alongside a surging small cap and penny stock market. While anything closer to $3 would be the ideal place to add this great penny stock to your portfolio, a buy in at $4 or less will still give you front row seats to the next quarter’s bounce to 6$ or more.
HTG Molecular Diagnostics, Inc. (HTGM)
Rounding out our look at significantly oversold stocks that are well on their way to a rapid rebound in price in the current positive climate for small caps and penny stocks is HTGM.
HTGM was a darling of the penny stock market at $19.75 in June of 2015, before it took a steady decline to $1.20 in February of 2017. After 2 failed attempts to break out above $5, it has again reverted to the 200-day EMA at $3.
This is a technical setup for a classic breakout the next time it challenges the resistance at $5. With little chance of a drop in price, any buy in at $3 to $4 is a free ticket to profits up to $5 and a chance at a major breakout above that level.