If January is a sign of things to come for 2021, traders and investors are going to make a lot of money this year. 4 stocks on the move are Inovio Pharmaceuticals (NASDAQ: INO), LM Funding America (NASDAQ: LMFA), Optec International (OTCMKTS: OPTI), and Sunshine Biopharma (OTCMKTS: SBFM).
HOW TO TRADE PENNY STOCKS
First up, it’s important to understand that trading penny stocks is not the same as trading blue chips. As we have stressed repeatedly to our subscribers, the key to trading penny stocks is finding momentum BEFORE it happens and then be patient.
We got our subscribers in early on TSNP, which you can read our latest here, and ENZC, which you can read about here. It’s also best to own a portfolio of quality penny stocks. For some that can be as many as 10 to 20 or more penny stocks.
Now, when we say that we find momentum BEFORE it happens, we are investors looking to position our subscribers BEFORE the move happens. This is where the big money is made and why so many of our subscribers are sitting on gains of over 7750% in ENZC and over 36,150% in TSNP.
We always alert our subscribers first before we publish for our regular readers. This is the value of having a subscription to Insider Financial, which you can sign up for here. We alert our subscribers with our best ideas before our regular readers.
Now we know many prefer to day trade, but we are not day traders here at Insider Financial. It doesn’t suit our personality and we don’t like the intraday moves markets make. We have found we made more money being patient and ignoring the day to day noise of the markets.
If you want to day trade, Insider Financial is not the place for you. When it comes to day trading, and if that’s what you are after, we recommend the folks at True Trading Group, which you can check out their live streams here.
OTC PENNY STOCKS VS NASDAQ/NYSE PENNY STOCKS
The fact is that there is always a bull market somewhere. That’s why it’s important for penny stock investors to trade both OTC and NASDAQ/NYSE penny stocks. There are always opportunities if you give yourself the flexibility to trade all markets.
Last year, for the first half of 2020, it was much more profitable to trade NASDAQ penny stocks than OTC. That is where we and our subscribers were positioned. We captured the runs in SRNE, NIO, INO, IBIO, WKHS, and many others. Then once the summer came, many of the COVID runners had failed to find momentum. We then pivoted to OTC and caught the runs in TSNP, ENZC, MMEDF, and many others.
So far this year, it’s best to play both OTC and NASDAQ/NYSE penny stocks. There is no shortage of multi-baggers in both markets at the moment. As we have said repeatedly, there’s no better time to be a penny stock trader and traders need to be aggressive. It’s like being at the casino. When you have a hot hand and the house keeps losing (hedge funds and institutions), take advantage of it while you can.
On the OTC, penny stocks that have the STOP sign are catching bids as traders bet on the stocks cleaning up their filings or doing a merger deal. With a STOP sign, the filings have not been filed on time so the company needs to catch up. Many of these aren’t good securities, but if there was a recent reinstatement (company updated profile checkmark) or filings are starting to pour in, a STOP sign that has been asleep for years is one of the best buys you can make since the STOP will become a YIELD and PINK current will be on the way. Examples right now include CYBL, ASTI, SHOM, and PLYZ.
On the NASDAQ and NYSE, we are seeing epic short squeezes that are being led by the army of day traders over at Wall Street Bets. The strategy is to simply squeeze the shorts and we love this. It’s a momentum strategy that any trader can implement. Simply go to finviz.com and screen for stocks. Use the Top Gainers signal and screen for stocks with a float short over 10%. The strategy is that once a heavily shorted name starts running. Momentum players jump on board and the shorts are forced to cover as the stock climbs.
This is what we are seeing in Gamestop, KOSS, Bed Bath & Beyond, BLNK, PLUG, WKHS, and even the dog shit stock Nikola. For those that are interested in this strategy, we wrote a detailed article with video analysis that explains how to do-it-yourself, which you can read here.
In this article, we take a look at 4 penny stocks on watch INO, LMFA, OPTI, and SBFM to find out what’s behind the move and our outlook for each.
Penny Stocks On Watch #1 INO
INO is no longer classified as a penny stock but was one this time last year.
We last covered INO back in September when it was under attack from short-seller Muddy Waters, which you can read here. INO is still under attack as the shorts have shorted 33% of the float. The difference this time is Wall Street Bets and the army of day traders are not going to take it any longer. The rise of this new breed of trader is about to burn the shorts to the ground.
INO has a lot of potential. INOVIO’s DNA vaccine candidate against COVID-19 showed 94% of immunogenicity according to peer-reviewed Phase 1 data published in The Lancet in late December.
The dosing of the Phase 2 segment of the Phase 2/3 clinical trial for the vaccine candidate, INO-4800 started in early December. The Phase 2 segment is evaluating safety and immunogenicity to confirm the dose(s) for the subsequent efficacy evaluation as part of the Phase 3 segment of the trial.
INO remains well-capitalized to see the trials to completion after just raising $150 million. We expect INO to keep climbing as the shorts get squeezed. Remember, last year’s high was $33. We could be back at the highs sooner than later.
Penny Stocks On Watch #2 LMFA
LMFA was a name that we talked about at the beginning of January. LMFA is an example of not chasing and waiting for the pullback and buying the dip. Investors that loaded the dip are seeing the payoff now.
LMFA is running as it seeks to capitalize on the hottest market trend right now – SPACs. LMF Acquisition Opportunities just closed its upsized initial public offering of 10,350,000 units, which included the full exercise of the underwriters’ over-allotment option, at a price of $10.00 per unit, resulting in total gross proceeds of $103,500,000.
Each unit consisted of one share of Class A common stock and one redeemable warrant, each warrant entitling the holder thereof to purchase one share of Class A common stock at a price of $11.50 per share. The Company’s units commenced trading on the Nasdaq Capital Market (“Nasdaq”) on January 26th under the symbol “LMAOU.”
Once the securities comprising the units begin separate trading, the Class A common stock and warrants are expected to be listed on Nasdaq under the symbols “LMAO” and “LMAOW,” respectively.
The SPAC intends to focus initially on a business combination with companies or assets in the financial services, including potentially the fintech sector, with an enterprise value of ~$250M-$500M.
LMFA is also benefitting from the Reddit crowd as 26% of the float is short. With a market cap of just $23 million, the short squeeze could be enormous.
Penny Stock On Watch #3 OPTI
We said that OPTI was a smart bet when shares were trading at just $.025 a share, which you can read here. Since then we said that OPTI was heading a nickel, dime, and then quarters. We’ve hit the nickel, dime, and quarter. A dollar is next.
Since our last coverage, which you can read here, OPTI acquired Z2O; a dynamic new Uber Type proprietary “App” for on-demand 24/7 cleaning and disinfecting services, using smart device technology for immediate service responses nationwide and ultimately worldwide, scheduled to launch March 1.
Optec International CEO, Roger Pawson, stated “We are very excited to have completed this acquisition, which has been in negotiations since August 2020. Optec is ready to fully launch the Z2O program commencing March 1st which is expected to rapidly expand across the country as the need for these services increase at a phenomenal rate as the pandemic reaches record levels. We believe the demand for these services using the Z2O app technology will surpass our projected expectations adding new highs to the company’s revenues and profitability”.
OPTI remains one of the best penny stocks for investors looking to play the COVID-19 pandemic. OPTI is a PPE company with a number of products that will see wide-spread use, regardless of a vaccine. This is why Dr. Drew has gotten involved with OPTI as Optec International’s Brand Ambassador.
Penny Stock On Watch #4 SBFM
SBFM is running from the double zeroes as the folks behind SBFM are making big moves. SBFM has a $2 million financing package with RB Capital Partners Inc.
SBFM is putting this money towards its ongoing development of the Company’s Coronavirus Treatment on a priority basis and the clinical development of Adva-27a, the Company’s flagship anti-cancer compound targeted for pancreatic cancer.
On May 22, 2020, Sunshine Biopharma filed a provisional patent application for several molecules that were designed by computer-aided modeling to inhibit the Coronavirus proteases, thus shutting down the ability of the virus to multiply. Sunshine Biopharma has since completed the synthesis of four such molecules and identified a lead compound, SBFM-PL4.
In collaboration with the University of Georgia, College of Pharmacy, SBFM is currently advancing the development of SBFM-PL4 through the in vitro testing stage to be followed by mice studies before entering clinical trials on COVID-19 patients.
In addition, tests conducted to date have demonstrated the effectiveness of Adva-27a at destroying Multidrug-Resistant Cancer Cells, including Pancreatic Cancer cells, Small-Cell Lung Cancer cells, Breast Cancer cells, and Uterine Sarcoma cells.
Clinical trials for Pancreatic Cancer indication are planned to be conducted at McGill University’s Jewish General Hospital in Montreal, Canada. Sunshine Biopharma is the owner of all patents and intellectual property pertaining to Adva-27a.
SBFM is PINK Current and has applied to become a QB on the OTC Markets. The financiers behind SBFM are already planning to uplist to NASDAQ.
Brett Rosen and Deborah Braun of RB Capital Partners Inc. stated, “We are very impressed with the Sunshine leadership team and their commitment to developing critical life-saving medical treatments. Our investment money has been met with ongoing milestones and we are pleased to be considered a long-term funding partner of the Company. We are looking forward to a potential up-list to the Nasdaq in the future.”
With a current market cap of just $33 million, SBFM is a ground floor opportunity ahead of a major run.
These 4 penny stocks need to be on your watchlist. There are always opportunities in the markets and it’s our job to find winning stocks. Huge gains can be made in such a short amount of time.
Our best advice is to be patient and throw bids in below the market. Buying dips and selling rips as swing trades remains the best strategy in these markets.
Remember, all it takes is one or two to become an INO, LMFA, OPTI, or SBFM and you’ve crushed the market indices for the year. Whoever said to avoid small-cap stocks has no clue what they’re doing.
As always, good luck to all (except the shorts)!
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Disclosure: We have no position in any of the securities mentioned. We wrote this article ourselves and it expresses our own opinions. We are not receiving compensation for it. We have no business relationship with any company whose stock is mentioned in this article. Insider Financial is not an investment advisor and does not provide investment advice. Always do your own research and make your own investment decisions. This article is not a solicitation or recommendation to buy, sell, or hold securities. This article is meant for informational and educational purposes only and does not provide investment advice.