Penny stocks move much faster (in both directions) which is why I prefer to trade them (not invest) over larger companies. Here is a few Lithium penny stocks on my watch list.   

LTUM @ 1.02 (Lithium Corp. up 343% on breakout volume of 14.4 million shares)

LTHU @ .044 (Lithium Technology up 49%.)

AMLM @ .55 (American Lithium Minerals up 89% on breakout volume of 3.7 million shares)

AMEL @ .54 (Amerilithium Coproration up 69%)

LEXG @ @ 10.57 (Lithium Exploration Group up 38% today..this was less than 10 cents a month ago.  I’m not going buy this one, way to expensive for me to trade, just listed it so you can research it and learn what causes a Lithium penny stock  to go up 10,000% in a month.)

EVCA @ .024(This is a wild card play.  Evcarco up 33% isn’t a Lithium stock but it’s mission is to make a wide selection of environmentally friendly vehicles available.  With the recent breakout chatter this may be another type of play to capitalize on the move in the Lithium sector.)

Let’s briefly discuss the traits of three types of emotional trades and how to avoid some pitfalls:

The Fearful Trader:  This trader hasn’t done enough research to really understand why a particular stock is on the move or why it could become the next hot penny stock.  Ultimately this lazy trader  (McFly) is looking for a get rich quick stock tip.  As such, McFly is like a deer in the headlights when the time to initiate a penny stock trade has arrived.   Because McFly has no self determined valid reason to initiate a trade, he sits on the sidelines watching the next hot stock begin to move up.  Later in the day, the stock pulls back to a support zone and then makes another large move up, but McFly is thinking it’s to late to get in now and still continues to watch.  The hot stock party continues as the stock moves to the high of the day.  Finally, fearful McFly can’t stand being left out and jumps in at the top.  Guess what, McFly is most likely going to get hosed again.  A Bold and Fearless trader would have remained calm, have the ability to make quick methodical decisions and be well prepared by having a complete entry (i.e. bought on a pull back) and exit plan (i.e. buying volume turns into selling).  The Fearless trader would have  had a number of tools available and at least understood share structure, technical indicators such as support/resistance zones, potential for dilution, news, what is driving the Hype (Pump), who the market participant are (i.e day traders), level II data (volume, time and sales) and so on.  You must  be  BOLD and FEARLESS by having as much  information as possible.  All available resources will assits you in your evaluation to either avoid the stock or provide you with a valid reason to initiate the trade at the correct time.  The Fearless trader also knows when to admit when they are wrong and isn’t scared to take a small loss before it becomes a bigger one.

The Greedy Trader:  This trader is never satisfied and believes that the stock is going to continue to move up  or doesn’t want to miss out on further gains.  Greedy fearful Mcfly happened to grow a set one day and  got lucky by  jumping in on a hot pump stock tip.  McFly only put in about $100.00 (because he is still fearful) and the stock happens to go up 100% in a short time.  But, McFly isn’t satisfied with only $100.00 profit because he wants more and it’s just not worth his time.  Well, it is possible that the stock will continue on up (maybe even 1000%).  So, McFly continues to wait but the stock pulls back and is only now up 50% near the close of the day.  McFly is pissed and doesn’t close the position.  After a few trading days, the hot stock turns into a stinky dried shriveled up old raisin and is now trading at loss.  McFly grows disheartened and lets the stock grow dust cluttering  his trading account with another worthless turd to add to his collection.  The GRACIOUS and FEARLESS trader would have been confident in his initial decision, put in a bit more money and began selling his position as the stock moved up. When the stock was up 100% he could have sold half his position so that he took some profits and remained in the game as it continued to move up or reduce his risk.  It’s easier to make $100.00 ten time then $1000.00 one time.

The Hopeful Trader:  This trader is pathetic, just doesn’t think or have any plan….he just hopes.  Hopeful Joe buys into any piece of hype, believes everything he reads is true and that others are honest.  Joe never admits when he is wrong, drinks the koolaid, smokes the catnip and thinks everything will work out.  Hopeful Joe is going to end up with a small fortune…….pocket change.  There is no hope when it comes to trading penny stocks, it is or it isn’t.  When it comes to penny stock trading, don’t trust anyone, believe nothing and be pessimistic.

Some Stocks to Watch Tuesday:

EYSM, SSHS, PFNO, CWRN and AMEL

So, Sssssshhhh be vewy quite….I’m stocking cwazy little stocks.  You know, the ones that pop their heads out of the ground and make a run for it.  Well, of course I’m not the only one out there hunting and stocking, we have competition and conspirators in the midst.  None the less, all us stockers collectively pounce at the chance when we see an opportunity to fatten our tummies.  You may think that poor little stocket is just so innocent with it’s big dark beady eyes but it’s not always what it seems.  The stocket begins to run around wildly, teasing and enticing you to pursue.  Up, down and around you chase that little stock till either you or it is caught, bagged, cooked and gutted.  I hope you don’t become dinner.

Two little ones popped out of the hole this October 4th of 2010….I have my sights set on em!

LFBG @ .0024

EPGL @ .0004

I think the timing is right and I’m ready to play the stock market game again.  But first I have to hunt those little hotties down that are worthy of my attention.  They may be easy to spot, standing out like a lighthouse beacon with a twinkle in her glass eye.  However, she is more like to be a Praying Mantis waiting to strike.  Not only will she bite off your head after your in, she will pocket your cash and kick you in the ash.  Yeah…I bet you think your big and smart enough to satisfy her so she lets your pocket grow bigger before you pull out.  More likely to be a big silly bug caught up in the electric bug zapper.  Have a plan before you get caught up in the hot stock hype.  Why not read some of my educational articles before you stick it all in again.

Penny Stocks to Watch week of 8/25/10

In addition to one beautiful lady (Nicki Minaj……check out her video “Your Love”)

ADAC @ 0.0103  (Volume and chatter breakout,  News, up ~347% from previous days close)

DMGM @ .035 (INSANITY - Supposed news  of $2.00 share buy out?????  Well believe what you want…I don’t.  However, what drives these stocks up is potential and hype.  The momo is on this one (for the momoment).   I been watching this from .015 and right now it’s at .15…wishing I had the guts to get in at .035….OH Well…  Way to risky for me now.  Not very often I see this kind of action with chatter building up so I just wanted to bring it up to your attention…..she sure has mine.)

Ruthless Penny Stocks to Watch

SKGO @ .0069 (Day # 1 Breakout volume, price and chatter.  Solid uptrend.  Lot’s of attention on this hottie but don’t forget that she is Ruthless and will take your money if you stop paying attention.)

BEDA @ .0024 (Breakout volume and price.)

HPNN @ .0108 (Breakout volume and price.)

CBAI @ .0107 

Don’t be a sheep following the heard.  Do your own homework and have a plan.  Checkout the education section in the category archives for more details.

EWKS @ .0004 (Historical breakout volume signals massive attention.  Day #1 of volume and price breakout so good chance she goes higher.  I tried a good part of Friday to buy in at .0002 and couldn’t.  The first time it hit .0004 was all the confirmation I needed to raise my bid.  I up-ed my bid to .0003 knowing I had a good chance that profit takers (up 300% at that point) would push the ask back down.  As expected that happened and my order filled and before long it was back at .0004.  Maybe we see .0003 (ask) again but I’m pretty sure .0002 (ask) is gone for now.)

BZCN @ .0028 (This baby has been on the watch list several times.  Boy I love BZCN she has been so good to me!!!!  What a great stock to trade last week and I still keeping her on my watch list.)

VIPR @ .0019 (Another text book beauty that  has been on the watch.)

KMAG @ .009 (Bounce play.  Breakout volume keyed me in but the price went the wrong direction…..SELLING!  I’ll be looking for buying volume as confirmation to enter this play.)

BLAZING STOCKS STILL ON THE RADAR

• VIPR @ .0016 (VIPR has appeared on our watch list a number of times and was just re-listed on 11/23/09 at .0008 and has moved up 100% since.  Today we had confirmation with breakout volume and price.)
• BZCN @ .0049  (Was re-listed on 11/22/09 at .0013.  Chat, volume and price continue.)
• QEDN @ .0006 (Listed on 5/21/09 at .0001.  Today we hit .0010 (900% move since first identified).  A bit of a pullback today as I was expecting, took some profits and remain in the game for now.)
• FFGO @ .0002 (Well she ain’t blazing at the moment but I still see some smoke so she remains on the list.)

I SMELL SOMETHING BURNING

• SARO @ .0005  (Hasn’t really begun to move yet but I did notice it was able to bust .0004 resistance with breakout chatter on iHub.)
• SKGO @ .0013  (Up 62% today)
• KENS @ .0475 (Up 69% today with a gap up from .028.  Don’t really like buying on gaps, I much prefer to see them pull back and fill the gap.  Breakout volume might signal that this fire is just getting started.)

TIP OF THE DAY (EASY MONEY) – PROFIT TAKING

Taking your money off the table (and some profits) along the way up eliminates your risk.  It is also much easier to get out on the way up instead of waiting for the scared money to run for the exit on the way down.  When a stock is up 700% in days (i.e., QEDN) how can you go wrong by at least taking your initial penny stock investment off the table?  It’s a good habit to start taking your profits by at least selling a portion of your position on the way up.  Yeah, the stock might continue to run to the moon and your thinking you don’t want to miss out and beat yourself up for getting out early.  Well are you going to beat yourself up if you didn’t take your profits when it turns around and goes back down?  So, maybe it’s wise to sell a portion of your remaining position (say 1/3 to 1/2) at each step along the way up because this always keeps you in the game, locks in profits and minimizes your risk (yes it also minimizes your reward but that’s the price of insurance).  How can you be wrong taking at least some of your profits off the table?  No matter which way the stock price goes at this point you will be correct because your still in the game on the way up or you took some of your profits if it goes down. 

WATCHLIST FOR MONDAY 11/30/09

• SYNJ @ .0010 (Volume and price breakout.)
• QEDN @ .0008 (Identified at .0001, remains on the  watch list.  However,  up 4 days now so I took some of my profits and still remain in the game with a portion of my original position.)
• BZCN @ .0035  (Re-listed at .0013 and still remains on the watch list.)
• FFGO @.0002 (Remains on the watch list.)

TOP PENNY STOCKS ON THE MOVE 

• QEDN @ .0003  (On 5/21/09 I informed you I was entering a position in QEDN as a high risk lotto play at an entry point of .0001 at the ask (there was no bid…which meant you could not sell at that time), today that finally paid off (I continue to hold a position).  Historical volume breakout!!! Price and Chatter breakout today.  This is day #1 so potentially there is a good chance this continues to rock.)
• BZCN @ .0020  (Re-listed on the watchlist Sunday at .0013 (up 53% today).  Volume and chatter continue to propel this upwards.  Not so thrilled about that gap up today.)
• FFGO @ .0003  (Actually placed this on the watchlist page on Friday morning 11/20/09 at a ask price of .0002.  Please refer to my article posted on 11/22/09 focusing on FFGO.  News, top of the message boards chatter, twitter and price move to .0004 (closing at .0003, up 50% today) all tell me this still has interest.)

MORE PENNY STOCKS TO WATCH 

• PMDP @ .0009  (Consolidating and holding .0008 support.)
• VIPR @ .0008 (Watching……..)
• ARSC @ .0006 (Adding to list Tuesday evening 11/24/09.  Volume breakout.  Closed at .0006 resistance (HOD)….watch to see if .0006 can be broken on strong volume.)
• CYBL @ .0004 (Adding to list Tuesday evening 11/24/09. Volume breakout.  Possible bottom zone.  Resistance at .0005)

THREE HOT PENNY STOCKS TO WATCH

FFGO @ .0002 (Placed on my watchlist page Friday morning based on volume.)

Some Pros:  Stock message boards lighting up.  Breakout from flat-lined.  Reports of company e-mail to shareholders I believe is what set this on fire.  FFGO on twitter http://twitter.com/ffgo .  #1 position on iHub message board at the moment.  Traded ~1.6 billion shares on Friday and didn’t close up (that’s not good but tested .0003), however on the pro side……looking back at the chart on 7/16/08 it traded ~924 million shares and on 7/17/08 it traded ~2.2 BILLION shares and at that time the share price also didn’t move past .0002 until beginning a move on 7/25/08 reaching a high of .0009 on 7/29/08.  Thursday and Friday’s volume pattern looks pretty similar to what happened then, maybe history will repeat itself or better.

Some Cons: Don’t know who to trust or what to believe.  Past behavior.  Share structure is huge and not clear what it actually is (supposed to be cleared up soon).  Ummm…this is a penny stock that can be easily manipulated. 

Well FFGO flashed me her goods and she appears hot for the moment.  I couldn’t resist temptation and bought me a piece of her on Friday at .0002 for a high risk lotto play.  It’s a gamble I’m willing to take but didn’t wager any money that I’m not willing to loose.  Maybe I’ll catch a nasty case of the hebbie gebbies or she will be one hell of a ride.  However, you can’t win the lotto if you don’t buy a ticket.  Big question is, what will we find in the bag when it’s opened?

BZCN @ .0013 (Back on the list with volume increase.)

PMDP @ .0011 (Back on the list.  Broke the uptrend but held .0008 support.)

Take some time to do your own research and add a comment below or in the forum.