Steps to Creating a Hot Penny Stock List

Having a Penny stock list at your finger tips is what you need to do frequent short term trading. You can create your own list by using technical analysis or you can buy a service that will provide you hot picks. Let's do a quick review of creating your own penny stock list.

Steps to Create a Penny Stock List

Using a Stock Broker

Find yourself an online broker. Most online brokers have stock screening tools to sort through the thousands of stocks available. The broker will have ideas on how to screen stocks that are typically pretty decent. I focus on companies that have shown a steady increase of cash flow in the past year. I also like picks that are under $2. This type of screening is easy with the right online broker.

Technical Analysis

If you are not familiar with technical analysis, you will need to take little time to get up to speed. The idea with this type of analysis is to review price history on charts to predict how the stock price will act in the future. Charting patterns, oscillators, and indicators used together are common tools to do technical analysis. When combined, they can help you find a share price that will most likely move up or down in the near future. Your online stock broker probably will have lots of information that you can read to get up to speed with technical trading.

Before I started using a stock alert service, there were a few things I'd look for when doing technical analysis. I would like to focus on spikes in trading volume and trend-line breaks. When I saw significant support or resistance broken while volume was spiking, this was a very good technical analysis sign to enter a trade.

Penny Stock Research

Finally, you'll need to know how to research a company you are considering to add to your hot pick list. The main component of this research will be financial. Understanding how to read income statements and balance sheets can shed some important light on potential picks.

If you thought penny stocks may be a way to make a lot of money, you are absolutely right. Having an easy way to create your own stock watch list or to consult a reputable company like Paradigm Capital Management to provide you a penny stock list is the most important part.

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