Penny Stock Picks – Here is The Right Way to Trade Them

There are websites everywhere that make big claims about big gains from penny stock picks. These penny stock alerts newsletters are often right, but just as often they are wrong. You’ve got to be careful whenever you’re trading penny stocks, no matter how hot the tip you got seems to be.

Do NOT be a penny stock chaser. You’ve got to get in ahead of Wall Street if you want to capture the biggest gains from the penny stock picks you receive. Don’t ever chase the penny stocks, you’ll lose every time. Whenever you get one of those penny stock alerts emailed to you, you’ve got to take a look at the chart before you decide to buy. Is the penny stock already up more than 300% in the past week or two? If so, it has probably already made its move and will likely only go down from where it is.

I used to just jump right in to all the penny stock picks I ever got. I made a lot of money but I also lost a lot of money. If I would have been more careful and selective, and only invested in the stocks that weren’t already flying too high, I would have still made a killing but not have taken nearly as many losses.

Hot penny stocks aren’t always what they seem. A lot of time buying a hot penny stock makes you a penny stock chaser, someone who buys penny stocks when they’re just about to crash. LOOK AT THE CHARTS! You’ll see if the stock is truly the real deal and about to make a huge move upwards, or if it’s all over and the big move has already been made.

You don’t need to be an expert trader or chart reading master. You just need to know the very basics. Was this stock 4 cents a week ago and 15 cents now? Boy that stock has already made an awfully big move. It may be poised to fall, even if you receive a penny stock alert in your email that says the opposite. Sometimes the penny stock newsletters are wrong. Now sometimes these high flying stocks continue to fly even higher, but the risk is so high in my opinion it’s just not worth it.

So before you jump right in to the penny stock picks you get in your email box, take a look at the chart to make sure you’re entering at a safe point. Has the stock been trading between 4-6 cents for the last month, AND it’s at 4-6 cents when you receive the pick? If so, that means you are getting in EARLY…ahead of the crowd. That means you’re primed to take an awesome ride to profits that often times range from 100-1000% or more.

No newsletter is right 100% of the time, even the ones with the best track records and best intentions get it wrong sometimes so you should always use caution. I’ve found this one pennystockalerts.com to be the best and most reliable, but still always double check with the chart. The charts never lie!

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Ryan Williams writes about Penny Stock Picks aE” For more information about penny stocks and hot penny stocks visit: http://pennystockalerts.com
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