3 Penny Stocks With Strong Technical Charts
Some investors prefer to look only at fundamentals for making an investment decision. Yet, others solely rely on technicals for trading. A combination of technical and fundamental analysis can be deadly.
We are going to explore penny stocks with average fundamentals and a strong technical chart. In my view, these stocks are likely to skyrocket in the first half of 2024, with the rally anywhere between 30% to 50%.
Notably, even fundamentally strong stories go through a phase of price and time correction. It makes sense to exit these ideas and invest in stocks that look strong fundamentally and technically. Therefore, many use a combination for trading as well as investing.
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Without further ado, let’s delve into three penny stocks with strong technical charts.
Iamgold Corporation (IAG)
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Since August, Canadian-based Iamgold’s (NYSE:IAG) stock price has been largely in the range of $2 to $2.5. In the last trading day, IAG stock surged by 12% with good volumes. In fact, a breakout is impending, as supported by two fundamental factors.
First, the federal reserve kept interest rates unchanged. In fact, multiple rate cuts in 2024 make for a strong case. This is bullish for gold, and Iamgold is likely to benefit in the form of higher realized gold price.
Further, Iamgold is positioned for production upside next year as Cote asset is 90% completed. Therefore, production growth and higher realized gold price will characterize 2024. Likely, this will translate into cash flow bump-up.
Technically, for the year-to-date (YTD) chart, IAG stock has remained sideways amidst volatility. This further strengthens the case for a breakout or breakdown from current levels. Fundamental factors point to a big breakout rally.
Bitfarms (BITF)
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Between mid-January and the last week of November, Bitfarms (NASDAQ:BITF) stock was trading sideways with a broad range of $1 to $1.2. In the last one month, BITF stock has skyrocketed by 157% on high volumes. Without doubt, this is a confirmation of a big breakout rally. However, the big question is whether the rally is likely to sustain.
BITF stock has more juice in the rally for the next two quarters. If we look at fundamentals, the upside comes from deeply oversold levels. Therefore, the stock remains inexpensive, and investors will buy into small corrections.
Going deeper into the fundamentals, two factors support the rally. First, Bitcoin (BTC-USD) is surging, and with halving due in 2024, I remain bullish on the cryptocurrency. Further, Bitfarms has announced plans to almost triple Bitcoin mining capacity by the second half of 2024. This will translate into robust revenue and cash flow upside. Another 50% rally from current levels of $2.95 does not look like a big hurdle.
Blink Charging (BLNK)
Source: David Tonelson/Shutterstock.com
Blink Charging (NASDAQ:BLNK) stock charts look scary.
A plunge of 76% in the last 12 months has destroyed investor wealth. However, trading volumes have changed since November 10, associated with the stock trending higher from that day. Indeed, the stock may be poised for a big reversal rally.
Notably, BLNK still has a short interest of 30%. It appears as a perfect short-squeeze rally candidate. Further, fundamental factors support the case for a strong rally.
The November 10th date above is significant because that is when Blink Charging reported Q3 earnings for 2023. It shows two big positive takeaways. First, Blink Charging continues to report stellar revenue growth. Further, the company has guided for positive adjusted EBITDA by the end of 2024. As cash burn declines, BLNK stock is poised for upside with industry tailwinds supporting long term growth.
On Penny Stocks and Low-Volume Stocks: With only the rarest exceptions, InvestorPlace does not publish commentary about companies that have a market cap of less than $100 million or trade less than 100,000 shares each day. That’s because these “penny stocks” are frequently the playground for scam artists and market manipulators. If we ever do publish commentary on a low-volume stock that may be affected by our commentary, we demand that InvestorPlace.com’s writers disclose this fact and warn readers of the risks.
Read More: Penny Stocks — How to Profit Without Getting Scammed
On the date of publication, Faisal Humayun did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Faisal Humayun is a senior research analyst with 12 years of industry experience in the field of credit research, equity research and financial modeling. Faisal has authored over 1,500 stock specific articles with focus on the technology, energy and commodities sector.
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