Like many traders, I’m looking to close out 2020. It’s been a crazy year full of twists and turns. Just when you thought you figured out the market, a Tweet or major headline put you back in check. Penny stocks were some of the standout investment classes this year. I’m not saying we should have a penny on the front of Time Magazine anytime soon. However, the shutdown from the pandemic caused millions of people to “figure out” that the stock market exists. As discussed earlier, some 5 million new accounts were created in the first 9 months, on Robinhood alone. This doesn’t take into consideration all of the other platforms’ new users in 2020.
Given this as the case, trading in 2020 has been much different than before. During the summer months, we saw some of the highest trading volumes since the end of 2018 (taking out the March sell-off volume, of course). The main difference is that during the summer of 2020, the high volume was buying volume If you remember the end of 2018, during the 4th quarter we saw much more selling volume. Needless to say, we’ve got traders of all walks. Some of them are brand new to trading. Others still have no idea what they’re doing and need some education.
The latter is likely the reason why states like Massachusetts has come out so strongly against Robinhood. This week, regulators in the state expressed concern with the way Robinhood attracts novice traders. The fact that so many newbies are flocking to the markets is great, in general. But the other fact that so many are diving in head-first without any education is troubling only for the simple reason that there’s higher chances of money to be lost.Should You Buy Penny Stocks Before 2021?
I don’t say this to scare anyone away. But rather to raise awareness that it’s important to have some general understanding of how to trade penny stocks first. At the end of the day, there will always be more stocks to trade. There will also be plenty of breakout opportunities down the road. But if you get into a trade and have no idea what to do, then you risk the chances of losing your hard-earned money. So are there good penny stocks to watch before 2021? The short answer is YES!Penny Stocks To Watch: Havn Life Sciences
When you talk about emerging industries, 2020 has actually been great for one in particular. A lot of that may have had to do with the recent election. No, I’m not talking about marijuana stocks. I’m talking about magic mushroom stocks or “psychedelic stocks”. Oregon legalizing psychedelics along with new initiatives conducted in Canada place a bright spotlight on this new industry. Similar to cannabis, the magic mushroom trend begins with biotechnology applications. Things like neurological disorders including PTSD are being studied with psychedelic-assisted treatment.
Havn Life Sciences (HAVLF Stock Report) caught a strong surge in trading momentum this month. Shares were trading around $0.60 at the start of December. They have since managed to climb as high as $1.25 and currently sit closely to 90 cents on Wednesday. The biggest point of focus for the company has been on its top leadership. Specifically, the man credited for building Aphria into the powerhouse pot stock from 2014 to 2019 now sits as the company’s Executive Chairman. Vic Neufeld helped create the cannabis industry during the grassroots era of the market. Now, he’s looking at another in magic mushroom stocks.
However, most recently, the company has reported significant fundamental milestones as well. This week, in particular, Havn announced a partnership with Complex Biotech Discovery Ventures. The pair will begin Health Canada approved analysis of psilocybin under Havn Life’s section 56 exemption. Why’s this significant? Havn Life will work towards the development of the very first library of psilocybin compounds and lay the foundation for the future development of proprietary extraction methods.Penny Stocks To Watch: Amplify Energy Corp.
Shares of Amplify Energy Corp. (AMPY Stock Report) were “amplified” on Wednesday. This was thanks to an analyst upgrade on the stock. Roth Capital boosted Amplify to a “Buy” and announced a $2.20 price target. Similar to Havn, Amplify has also experienced a strong month in December so far. Since the 1st, AMPY stock has climbed from $1.03 to recent levels of $1.48. Roth also acted as the manager for the company’s recently closed public offering.
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We’ve seen plenty of volatility among energy names this quarter. Amplify is no different. The company is an independent oil and gas company with properties in Oklahoma, the Rockies, Texas, and offshore California. The election of Joe Biden as President of the United States has placed a question mark on the energy sector as a whole. However, even if the goal is the transition to renewables, it’s going to take a lot of infrastructure to get there. Right now, the popular form of fuel is oil and gas.
On top of that, most oil and gas stocks have a tendency to move in lockstep with the commodity. In light of this, stocks like AMPY could be ones to watch as oil, specifically, has mounted a strong recovery heading into the end of the year.Penny Stocks To Watch: Atossa Therapeutics Inc.
Another one of the biotech penny stocks on this list, Atossa Therapeutics Inc. (ATOS Stock Report) has attempted to extend a 3-day move on Wednesday. This month the company’s shares were hit hard after the company announced an equity offering of $20 million. It actually was the catalyst that sent ATOS stock from around $1.50 to as low as $0.855.
Much of the focus from investors has been on Atossa’s COVID treatment candidate. In Phase 1 clinical studies, its AT-301 nasal spray showed both safety and tolerability. AT-301 is being developed for at home use for patients recently diagnosed with COVID-19.
“Our preliminary assessment is that our AT-301 nasal spray was safe and well tolerated in this study. These results support advancing this program into a Phase 2 study. We are in the process of preparing a pre-IND meeting request with the U.S. FDA which we plan to submit in the next 30 days.”Steven Quay , M.D., Ph.D., Atossa’s President and CEO.
That quote was from a November 10th press release. Considering the fact that no new updates have come about regarding the IND meeting request, could this be speculative momentum building around ATOS this week? What’s more, is that analysts at Ascendiant Capital have shown a bullish tone. Earlier this year, the firm started ATOS with a Buy rating as well as gave a $7 target; 629% higher than the current market price.Penny Stocks To Watch: Onconova Therapeutics Inc.
Sticking with the biotech trend, Onconova Therapeutics (ONTX Stock Report) has also caught a nice uptrend on Wednesday. As one of the cheaper penny stocks to watch, ONTX trades around 35 cents. We saw a nice pop in the stock a few weeks back. That stemmed from the company’s filing of a New Drug Application for its cancer treatment candidate, ON 123300. The IND seeks permission to begin a Phase 1 trial with ON 123300 in certain relapsed/refractory advanced cancers including patients with HR+ HER 2- metastatic breast cancer.
This week, in particular, ONTX stock has been a part of the discussion following more fundamental developments. A FORM 4 was recently filed showing that insiders are beginning to buy stock. Abraham N. Oler, the company’s SVP of Corporate Development & General Counsel picked up 30,000 shares of ONTX stock at an average price of $0.32. Whether or not insider buying has helped contribute to Wednesday trading is still yet to be seen. Needless to say, the stock caught a strong move late in the afternoon session.
This isn’t the first time in recent weeks that insiders were picking up shares either. At the end of November, the company’s Oler along with the company’s CFO, its CEO, and one of its Directors collectively purchased nearly 120,000 shares between $0.256-$0.265. This was seen as a strong vote of confidence as ONTX stock surged after hours on Monday.