Finest Penny Shares to Watch in February 2025

As soon as a inventory value is beneath $5 per share, it’s categorized as a penny inventory. Regularly, however not all the time, penny shares have small market capitalizations and are susceptible to excessive volatility because of low liquidity and buying and selling volumes. Penny shares can, subsequently, present a chance for giant, fast beneficial properties as a result of a small motion within the value of a penny inventory can produce a big share acquire. However in addition they carry vital dangers in comparison with extra established shares. To protect towards the dangers related to investing in penny shares, the shares mentioned on this article have a minimal value and quantity standards, together with clear chart patterns and different technical evaluation indicators.

Beneath is an evaluation of creating bullish patterns in penny shares for February 2025, pulled from a display displaying optimistic one-month efficiency, a minimal value of $1.50, and 30-day common every day quantity of 200,000 shares.

All charts and knowledge are present as of Jan. 29, 2025.

• Value: $1.50
• 30-day return: 17.2%
• Common every day buying and selling quantity: 1,798,400
• Alternate: Nasdaq

ATAI Life Sciences N.V. (ATAI) is a biotechnology firm centered on advancing novel psychological well being remedies by leveraging psychedelic compounds and progressive drug growth methods. Following its IPO in June 2021, the corporate’s inventory hit a excessive of $22.91 after which toppled to a low of $1.02 in November 2023. That low was 95% beneath the excessive and established a primary backside for a multi-year sideways potential bottoming sample. A second backside within the sample was established in October 2024 at $1.03. After the primary backside, the inventory of ATAI noticed an 18-week, 178% acquire of $1.83 to a excessive of $2.85. From the October low, a measured transfer of that advance would full at $2.86.

• Value: $3.09
• 30-day return: 24.6%
• Common every day buying and selling quantity: 4,228,700
• Alternate: Nasdaq

The inventory of BTCS Inc. (BTCS) surged by $3.95, or 270.6%, in a single week throughout early November, reaching a excessive of $5.41. A pullback adopted to a swing low of $7.35. That swing low efficiently examined assist largely above prior swing highs and close to the rising 20-week transferring common. These are indicators of a strengthening uptrend. Because the low, the correction has taken the type of a possible bull flag sample. It most likely wants extra time to type as every channel line has just one contact. Given the sharp rise that occurred previous to the flag forming, referred to as the pole, there may be the potential for a second sharp rally following a breakout of the flag. BTCS Inc. is a monetary providers firm working within the blockchain know-how sector.

• Value: $2.33
• 30-day return: 48.4%
• Common every day buying and selling quantity: 694,900
• Alternate: Nasdaq

Compugen Ltd. (CGEN) is a biotechnology firm centered on most cancers and immune-related illnesses. The corporate’s inventory broke out of a bull flag sample the week of Jan. 13 and reclaimed each the 20-week and 50-week transferring averages on the breakout. Resistance was seen at a excessive of $2.54. That was a check of resistance on the 200-week transferring common. The inventory of CGEN has been buying and selling beneath the 200-week transferring common since July 2021. That is the primary shut method since then. Given the bullish implications of the bull flag sample, it was preceded by a pointy advance of $2.50, or 471.7%. Quick-term weak spot may set the stage for a continuation of the bull development and a breakout above the 200-day transferring common.

• Value: $3.11
• 30-day return: 108.7%
• Common every day buying and selling quantity: 1,010,300
• Alternate: Nasdaq

The inventory of Compass Therapeutics, Inc. (CMPX) broke out of a bullish inverse head and shoulders backside sample in early January earlier than reaching a excessive of $3.63. That top virtually accomplished a 61.8% Fibonacci retracement of the prior downswing. Nonetheless, a retracement ought to result in new short-term bullish setups, on condition that the underside reversal was solely just lately triggered. Discover that previous to the breakout, the 20-week transferring common crossed above the 50-week line, indicating a possible change within the long-term development. Compass Therapeutics, Inc., is a biopharmaceutical firm centered on oncology.

Tetra Applied sciences Inc. (TTI) is an oil and gasoline gear and providers firm. Its inventory has been advancing in a rising development channel that has stayed largely above the 200-day transferring common since 2021. Just lately, a bull breakout of a small inverse head and shoulders sample triggered above $4.12. The sample shaped in a bullish place above assist on the decrease channel line. Different indicators of power embrace the 20-week transferring common turning up following a reclaim of the road in early November, and the reclaim of each the 50-day and 200-day transferring averages a number of weeks in the past. Furthermore, the inventory of Tetra Applied sciences is again above the long-term downtrend line. 

What to Know About Penny Shares

Many penny shares commerce through over-the-counter (OTC) markets, which implies they’ve minimal regulatory oversight and little analyst protection, making it tough to entry correct firm info.

Nevertheless, the penny shares we have recognized on this article are all listed on the New York Inventory Alternate or Nasdaq, which implies they’re topic to the identical itemizing necessities as another firm on these exchanges. These necessities are supposed to make sure that solely high-quality securities can be found for buying and selling on the change.

Whereas penny shares are a riskier funding than established shares because of their volatility, the potential for top returns is engaging to some traders.

How We Selected the Finest Penny Shares

To display for penny shares with attention-grabbing chart patterns and different technical evaluation indicators, we used the next standards. Shares needed to have optimistic one-month efficiency and be priced underneath $5.00. To assist enhance the reliability of the chart patterns, the shares needed to have a minimal value of $1.50 and a mean 30-day buying and selling quantity of no less than 200,000. The inventory additionally needed to have no less than 24 months of buying and selling historical past.

The charts had been additionally reviewed for bullish patterns, together with breakouts above trendlines, key resistance, and transferring averages. Candlestick patterns had been additionally thought of, as we seemed for indicators that pointed to a bullish development reversal or indications {that a} development was strengthening. Nonetheless, it is vital to do not forget that previous efficiency shouldn’t be a assure of future efficiency.

Penny Inventory Benefits and Disadvantages

The low value of penny shares presents traders excessive potential for progress, they usually may give smaller companies a platform to entry funding. However whereas these shares can carry traders vital beneficial properties, in addition they carry the chance of serious losses. There are better dangers related to investing in penny shares than with extra established shares.

Penny shares often lack liquidity. It may also be tough to seek out strong public details about penny inventory corporations that commerce over-the-counter. Given the extra dangers, penny shares usually are not appropriate for all traders, particularly these with a low threat tolerance.

One other drawback is that the worth patterns might take longer to unfold and single-position drawdowns may be bigger than regular, given the upper potential volatility in low-priced shares.

There are methods to mitigate the added dangers, beginning with elevating the minimal value and common buying and selling quantity and choosing penny shares that commerce on the NYSE or Nasdaq. General portfolio threat may be contained by allocating solely a small quantity of whole capital to the penny inventory market.

By fastidiously screening, watching, and ready for value patterns to unfold, traders can entry a market atmosphere that has the potential for giant beneficial properties in a comparatively quick time period. However that is dependent upon getting into a place on the proper time.

The Backside Line 

Penny shares have the potential to generally see sharp multi-week or month rallies that, on a share foundation, exceed expectations. They will current alternatives for traders which might be tough to seek out in any other case. This text options 5 attention-grabbing charts of penny shares that had superior throughout the prior 30 days and confirmed upside potential, given the offered technical evaluation.

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As of the date this text was written, the writer doesn’t personal any of the securities listed above.