Sub Penny Stocks

TRANS GLOBAL GRP is the sub penny stock we briefly mentioned last week.  Today it broken down badly and on high volume below what we defined as a critical holding point at .0006 or higher.

TGGI was not able to hold up trend line support as we said is must do in order for it to remain bullish and get a new leg higher.

We are making this post on TGGI not to come off sounding like a wise owl or ‘I told you so’.  Observing why and where penny stocks fail is just as important as feeling great about penny stock moves that break out and are successful.  If we do not take the time to go over what has failed and WHY in penny stock land then how on earth is any one going to learn anything ?

Most other penny stock sites just focus on the winners.   They do not take the time to look at in depth why certain penny stocks failed and the REASON WHY they failed.  Instead they just keep quite about them and hope you will forget.

Here at penny stocks penny stocks dot com we take a different approach.  We think it is important to look at the winners and the losers as  means to fine tune timing techniques.  It is just like anything else in life.  If you don’t learn from your mistakes then how will you get any better at something in the future ?

So getting back to TGGI.  It is important to point out that what TGGI should have done near the up trend line of support was show us a very quick and convincing upward reaction that showed a sign of strength, a reversal candlestick formation or at least some sign that it was not interested in lower prices.

It was not able to show us or prove itself and thus is now headed into the recycle bin.  Notably today’s break down was also on quite heavy volume.  Also notable is that RSI was not able to hold 50 level and is now into more bearish territory below the 50 range.

The best attitude to take with all penny stocks is that they MUST PROVE THEMSELVES to you.  They must really show you with almost no doubt that they have inner strength and will conform to your supportive rules.  Most of them don’t conform and end up turning out like TGGI.  But some of them do and those are the ones where it is best to focus all energy in our opinion. . .

So lets remember TGGI as a useful penny stock lesson if you will.  The more we can learn about the “fail or pass” behavior of these stocks the better off we are . . .

TRANS GLOBAL GRP IN (Public, PINK:TGGI) is in a do or die scenario.  This sub penny stock has hit the lower limits of an up trend line on the semi log chart that absolutely must hold tomorrow otherwise TGGI will head to the recycle bin.

This is about as clear as it ever gets in penny stock land.  TGGI must hold .0006 level tomorrow otherwise it risks a break of this uptrend.  The good thing I can say about this sub penny stock chart right now is that price has so far held support and today’s drop was on relatively much lighter volume compared to weeks earlier.

Also notable on the chart is that the RSI (relative strength index) is just perched up on the midpoint 50 level.  This is bullish as long as we STAY above the 50 mid point level.  A break down in price tomorrow will send the RSI below 50 which will confirm the bearish signal.

Overall I have to say that the whole volume pattern is quite bullish looking. I have not seen any huge surges in volume on any of the down spikes in price.  This could mean we will hold tomorrow and rest of this week.  But I can only speculate.  Either we do or we don’t.  Don’t second guess it.  Just let the stock do the work of telling us.

The huge volume surge is what makes this sub penny stock interesting.  But it will need to start surging again along with holding .0006 to keep this uptrend moving.

When penny stocks die, they usually do it by breaking up trend line support and then volume dies as well.  It will be interesting to see how this one shakes out in the final analysis. . .

Sometimes the difference between a great penny stock that performs like a champ and one that is lackluster and weak is only 1/2 of a penny.  This appears to be the case for STRATTON HOLDINGS right now.

It must hold the .0049 level otherwise the uptrend line of the recent large swing trading range is at risk of breaking.  Anything under .0049 and STRATTON HOLDINGS goes into the recycle bin.  But if somehow, some way STHG can hold here and move higher the rest of this week it may have some life left in it.

With penny stocks one has to be extremely picky and critical of how they behave.  This is no love affair here.  Either a penny stock behaves to your criteria or you kick it right out your front door until it gets its act together again.

The red dotted trendline is the one I am referring to in the chart above.  Today we touched it but admittedly on light volume.  The MACD histogram continues to have downward momentum and shows no signs as of yet of any kind of buy reversal signal. . .

The penny stock Stratton Holdings Inc may be once again coming near a reversal point.  I mentioned this penny stock before as one that seems to be fairly liquid and also constructive in that it seems to want to trade in a slow upward slanting trading range.

It has been a fascinating penny stock in that it has shown very clearly with reversal candlestick hammers its intention to trade back to the top of the wide swing trading range.

STHG appears to be forming a small reversal hammer again today and is trading in a downward slanting flag formation.  Volume is also contracting down within this formation.  I suspect that it may make a shot at the topside of this falling wedge and get another 1 to 3 day move topside before succumbing to overhead resistance again.

This penny stock just fascinates me for the simple reason that it trades with robust volume and has nice big ranges.  It is like a blue chip stock with big trading ranges and interesting valleys along the way.

Next week STHG may make another run to break overhead resistance.

This is one to keep an eye on because of its large penny stock swing trading range and seemingly clear reversal signals.

Still, there is always the risk that this penny stock will break down from the up trend line support in force since 7/7/2010.  STHG is sitting right now along this support line and it does need to get a topside reaction soon otherwise it will risk spending too much time near the support line of this swing trading range.

TRANS GLOBAL GRP (Public, PINK:TGGI) has a reasonably good looking penny stock chart.  TGGI is a sub penny stock trading at .0009 right now and has robust volume recently and a nice saucer type bottom formation.

I am not giving this penny stock the highest rating of 1 on the penny stock rating system but it is still worth a mention as a possible mover in the next few days or weeks.

Trans Global Group positions itself as a green penny stock with a few interesting products and also recently acquired Full Spectrum Media which has a catchy type product called ‘sexlets gum’.

So it seems to have at least a little bit of ‘buzz factor’ that penny stocks tend to need sometimes to keep a good trend going.

Anyway, the most important thing is the stock chart.  The chart seems to be saying that TGGI wants to continue in a slow and steady uptrend.  But in order for it to do so it will have to break and close above .001 in the days ahead.

If you look at the chart below you can see that TGGI has traded high off of a small flat base and formed a series of falling flag patterns.  Each time it has managed to break out above them with breakout type volume.

This is what one would want to see again in the days ahead to confirm that another new mini up leg is about to start.  This green penny stock does not tend to get a break out move going for more than 2  to 3 days at most and this is a very important consideration.  Assuming it does get a breakout north from the recent consolidation, it will need to overcome the August 4th and August 5th swing highs which were both on extremely heavy volume.  This is not easy to do.

There is always the risk that TGGI can continue to trade down deeper into this declining wedge flag formation and never get a breakout going.

The two horizontal green dotted lines I have drawn in the chart show that the price of TGGI recently was halted at .0011 resistance and has now consolidated.  This is a very common occurrence when a penny stock hits overhead resistance.  The KEY to watch for is how it REACTS to this important overhead resistance and to SEE if buyers can come in.  If the too many sellers exist then the penny stock will fail and fall down much DEEPER and even back to the all time lows.  This would show the penny stock is not ready for a new uptrend.

However if TGGI can maintain composure here and get a break out into the green shaded area then it could make a run for .0018 range which is next topside resistance.

The heavy volume is a good sign, it is supporting this penny stock, but a breakout from the recent falling wedge is not a breakout until it actually happens, so caution is still advised on this green penny stock near term.

A buddy of mine mentioned STRATTON HOLDINGS STHG to me in an email the other week and I am consistently amazed at the penny stocks he seems to find that are usually of high quality and good chart structures as well.

The chart of STHG shows how it had an absolutely amazing run up from .0009 to .02 and change!  That is an amazing penny stock run by any comparable standard.  That is the kind of run that should have options traders wondering if they are in the right business.  A move from .0009 to .02 is like a regular stock moving from 9 dollars to 200 dollars.  Truly amazing.

But what strikes me about the chart of STGH right now is that for the last month or so it has traded in a series of swing trading ranges and is almost trading like a blue chip stock with similar signals.  It is a superb example of how penny stocks can also behave in a somewhat respectable fashion with a little patience and observation.

If you look at the chart above you can clearly see where I have drawn the red arrows that STHG formed reversal hammers that EACH TIME has lead to a move back up topside to the top of the swing trading range.

Keep in mind that this swing trading range is no small deal.  We are talking a range of 30 to 50%.

The other interesting point about STRATTON HOLDINGS right now is that the swing high on 6/24/2010 which marked the peak of the run up was on high volume and was never tested.  This is clueing me into the idea that this swing high needs to be tested before we can say the run is over.

Right now the current swing trading range seems to be bumping into resistance line near the .009 range.  If STHG can blast above .009 then I think it has entered the zone where it could get a new move back up to the swing high near .02 again.

The volume has been robust throughout the entire swing trading range and shows the stock is being supported here.

Definitely an interesting one to watch here for future possible moves with some interesting key levels to watch for.

I will probably do some follow ups on STHG in the future depending on what transpires in the chart of this penny stock.

Majic Wheels Corp is a pinksheet penny stock whose sole product from what I can tell is this little toy car that can drive vertically on any wall and also on the ceiling above you.  It seems like an interesting concept for a toy but I am trying to put my ‘little kid hat’ on and wonder if this product could ever hit mainstream and be a hit.  To be honest I am not sure.  It suppose it would be a hit to show off to your friends (isn’t that one of the big reasons why kids love toys so much anyway so that they can show them off to other friends) but maybe after a little while the novelty would wear off.

But that is probably true of most toys anyway after a while.  I guess it depends on how complex the toy is and the levels you can take it to.  This product seems like it is somewhat uni dimensional.  Still it is an interesting concept.

You can see the video of this gravity defying remote control car here.

More interesting is the price chart of this penny stock.  It had a huge move up today almost 83% and the chart seems to have a saucer bottom formation.  Today’s volume was the highest since February 2010.

I like the general shape of the trading pattern since February 2010 as I indicated earlier a saucer bottom formation.

I also like the fact that volume basically dried up to nothing during mid July, it was practically non existent and there were no trades for several days at a time.  The reason I like this is that it tells me the stock had reached its selling exhaustion limit.

The candlestick on Majic Wheels Corp today printed an absolutely beautiful MARUBOZU candlestick which shows that the buyers took control right from the open and closed right at the highs which shows they really controlled the action and trend all day.  Seeing a marubozu candlestick near the bottom of any price chart is always a good thing because it shows a complete transfer of demand after the previous bear market.

I also like the fact that this marubozu price candlestick has tested the previous shelf of swing highs on dramatically higher volume.

So that was the good. What about the bad?

The bad part about this penny stock is that it has very spotty inconsistent volume.  This is never a good thing even in penny stock land. Because of the spotty volume MJWL has the ability to do 100% retracements of an upside move very quickly.

I suspect this penny stock will gap up at the open tomorrow.  It seems to have the possibility of reaching .015 to .02 but again the spotty volume is a definite risk element.

The low volume is the reason why I cannot give this a penny stock rating of 1.  I am guessing here but this penny stock may be able to maintain a robust 2 to 3 day volume pattern into the end of this week.  But again, it has shown the ability to retrace very dramatically despite the promising nature of the chart.

A trader friend of mine pointed out INAR to me the other day.  After he first mentioned it I looked at it only briefly and concluded that it needed to do some more work after the initial early August breakout type move on huge volume.   But now I am looking at it a bit closer and this penny stock might have some potential.

It appears clear from looking at the penny stock chart of INAR that the big spike rally in mid May was preliminary demand.  Then we saw a sell off and a retest of the .001 level which INAR was completed successfully.  Price was able to hold the double bottom without breaking down below.

Now we are seeing another attempt at a rally on huge volume.  After the volume and price spike after a week ago INAR has settled down into a small sideways  trading range.

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You can click on the chart of PGCR above to see it full size (note please ignore the x axis monthly dates because they are incorrect, the price is correct but the dates are wrong. It is the only way I could get the data in my charting program).  I still like the way PGCR is trading so far.  It continues to trade sideways now near the longer term triple bottom support area. 

I continue to believe that PGCR could be close to a spike rally north.  If I am wrong then I think the best alternative is to see PGCR trade sideways for a longer period of time. The 13 day moving average has still not crossed above the 50 day moving average but it is awfully close.  Volume has really dried up as of late, but is that surprising in August? 

If PGCR is able to keep trading sideways without breaking below .002 then to me it would be a bullish longer term development because the stock could be building a big base and longer term cause for the eventual move up.  But it is imperative that PGCR is able to hold .002 .  Perhaps the best shot PGCR has for a repeat type super spike rally is the October to January 2009 time frame.  Rest assured I will post here when I see important new developments.

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The penny stock VIPR Industries may be setting up for a move this week.  It is somewhat of a simple setup but could have some juice in it.  Caution is still advised because there is not much sideways cause for VIPR. 

The positives here are the bombshell volume that occurred about 3 days ago on the first spike upwards.  That was on over 100 million shares.  Then the next day retracement downwards was on dramatically lighter volume.  The drop off in volume was substantial and I do not usually see such a dramatic drop off in volume like that after such a big move, especially on penny stocks.  The actual percentage drop off in volume on VIPR was by about 68% which is huge. 

We may have very quality volume here in VIPR.

Then on last Friday price on VIPR starting catching wind again and volume increased substantially to about 67 million shares.  So roughly 60% of the free tradable float could be bought up at this point.

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