The push on stock prices driven by the “January Effect” ended in early April, giving way to a stockpicker’s market that is expected to last into the summer months, according to Investopedia. Such a climate favors a trading environment in which a handful of penny stocks can defy broad-based indices. April’s penny stock focus has moved away from speculative biotech and precious metals into a variety of sectors, including transportation, energy and beverages.
Antares Pharma, Inc. led the upside and rallied to a new high while Western Copper and Gold, Corp. managed to survive a metals shakeout. Both stocks have been added to April’s list, along with Valhi, Inc.
Penny stocks to watch this month include the following.
1. Antares Pharma, Inc.
Antares Pharma, Inc., a specialty pharmaceutical company that focuses on the development and commercialization of self-administered, parenteral pharmaceutical technologies, reached an all-time high at $5.58 in 2012, then began a downtrend that ended at 67 cents in the first quarter of 2016.
The stock reach $1.80 in November, setting off buy signals that delivered gains beyond 50% in the last four months.
The rally pierced resistance at the .786 Fibonacci selloff retracement in March and held the gains into the end of the quarter, raising odds the stock will complete a 100% round trip to its 2015 high above $3.00. That rally will set the stage for more gains that test resistance at $3.50.
The company operates in the drug delivery segment, which includes the development of injection based pharmaceutical products, injection devices and transdermal gel products.
2. Western Copper and Gold, Corp.
Western Copper and Gold, Corp., which engages in the exploration and development of copper gold deposits in the Casino project located in Yukon Canada, suffered a commodity shakeout born of doubts about President Trump’s infrastructure initiatives.
The stock held well during the downturn, falling into range support at $1.20 which defined a floor since December. The stock rallied in March and closed above the 50-day exponential moving average (EMA) for the first time in three weeks.
A breakout will target the 2011 all-time high at $4.49, which could deliver a larger scale breakout or topping pattern. Hence, buying within the current trading range could pay off with a broader uptrend facing no overhead resistance.
3. Valhi, Inc.
Valhi, Inc., a holding company which engages in the manufacture and marketing of titanium dioxide pigments, topped out in the low 20s in 2011 after a multi-year rally, then tested the high two years later.
Sellers then took over and triggered a decline that extended to the first quarter of 2016, driving the stock down to a 19-year low at 85 cents. The stock then rallied, reaching the 50% retracement of the last selling wave in January 2017, easing into a symmetrical triangle.
Soft price activity in March settled at the 50-day EMA, a typical location for the start of a breakout. Now it will require a rally beyond $3.75 to confirm a bullish outcome. Momentum is set to escalate when it mounts additional resistance at $4.00, favoring an upside that could finish a round trip to the 2015 high at $7.33.
The company operates in waste management, chemicals, component products and real estate management and development. The chemicals group produces and markets titanium dioxide pigments for plastics, paints, fiber, paper and ceramics. The component products group includes throttle controls, gauges, security products, stainless steel exhaust systems and trim tabs. The waste management group covers the processing, storage, treatment and disposal of hazardous, toxic and other wastes. The real estate management and development group develops land holdings for residential, commercial and industrial purposes.
4. Rexahn Pharmaceuticals, Inc.
Rexahn Pharmaceuticals, Inc., a clinical stage biopharmaceutical company, reached $6.00 in June 2008 and sold off at 40 cents in September 2009. It posted a lower high at $3.68 in 2010, then began a steep decline before finding support near 30 cents in 2012. It posted a second lower high at $1.85 at the start of 2014, drawing aggressive selling pressure, followed by a decline that broke multi-year support in September 2016.
The stock settled at 13 cents by year’s end, lifting above broken support in March, setting off a buy signal that denoted the failure of bears to defend resistance. The rally ended at 56 cents mid-month, making way for a small pennant that could support even higher highs. A pullback to 30 cents could offer a low-risk buying opportunity.
Rexahn Pharmaceuticals focuses on the discovery, development and commercialization of cancer treatments and other medical needs. The firm has three clinical stage oncology candidates: Archexin, RX-3117 Supinoxin and a pipeline of preclinical compounds that treat multiple types of cancer. It also developed drug discovery platform technologies in nano medicines and 3D gold.
5. Southcross Energy Partners, L.P.
Southcross Energy Partners, L.P., which provides natural gas gathering, processing, treating, compression and transportation services, and natural gas liquids (NGL) fractionation and transportation services, went public in the mid 20s in 2012. The stock immediately moved sideways into a 2015 downtrend that fell to an all-time low in February 2016 at 38 cents. A recovery wave stalled at $3.65 in April, dropping steadily to a higher low at $1.10 in November following the presidential election.
The stock recovered in January 2017, gaining at a steady pace into March, completing a 100% round trip to the April 2016 high. A cup and handle pattern could yield a rally above $6.00 as a measured move target. Weekly relative strength cycles point to another few weeks of consolidation prior to clearing range resistance.
The company also sources, purchases, transports and sells natural gas and NGLs to its power generation, industrial and utility customers mainly under fixed-spread contracts.
6. Castle Brands, Inc.
Castle Brands, Inc, which imports, markets and sells premium and super premium brands of whiskey, rum, liqueur, vodka and tequila in the United States, Canada, Europe and Asia, began an immediate downtrend following its 2006 IPO at $7.75, dropping into the 2009 all-time low at 1 cent. It rebounded in two rally waves, with the first reaching 74 cents in September 2009 and the second hitting $2.03 in November 2014. The stock then began a decline that extended to December 2016, falling to a 3-year low at 65 cents.
The stock gapped up on March 1, doubling in a single session following an acquisition, then pulled back to 92 cents days later. The stock has since gained ground over a 3-year period that’s now testing the rally high. The stock could break immediately or fall in a final pullback to around $1.15, finishing a bullish pattern targeting the 2014 high above $2.00. (The current price is now $1.64.)
7. Protalix BioTherapeutics, Inc.
Protalix BioTherapeutics, Inc., which develops and commercializes recombinant therapeutic proteins based on the ProCellEx plant cell expression system, topped out at $48.40 shortly after going public in 2007 and selling off at 96 cents during the 2008 economic collapse. It rebounded to $12.50 in 2009, marking the highest point in the last seven years. A subsequent decline found support in 2012 at $4.06, ahead of a 2014 breakdown that ended in December 2016 at 26 cents.
The stock surged in January and gained ground in the Feb. 13 peak at $1.48. It has since consolidated, finding support near $1.10.
Protalix Biotherapeutics offers Taliglucerase alfa injections under the brand name Elelyso, an enzyme replacement therapy for the Gaucher disease. The company’s drug candidates include Oral Glucocerebrosidase for the treatment of Gaucher disease; therapeutic proteins for Fabry disease and immune diseases like rheumatoid, psoriatic and juvenile idiopathic arthritis, ankylosing, spondylitis and plaque psoriasis; and protein for biodefense and other indications.
8. Diana Shipping, Inc.
Diana Shipping, Inc., a holding company that provides shipping transportation services through the ownership and operation of dry bulk vessels, reached an all-time high in 2007 at $45.15 after going public in 2005 in the mid-teens. The stock hit a bear market low at $6.85, then bounced to a lower high at $19, followed by renewed selling pressure that broke the low in early 2016. The stock reached an all-time low at $1.95, bouncing around that level before recovering.
The first wave stalled at a November 50% selloff, giving way to a pullback and a bounce that reached the prior high. A breakout could fill the November 2015 gap between $5.70 and $6.00.
The company charters and transports a range of dry bulk cargoes that include commodities like iron ore, coal, grain and other materials along worldwide shipping routes.
9. Document Security Systems, Inc.
Document Security Systems, Inc., which engages in the development and market of paper and plastic products that protect information from unauthorized scanning, copying, and digital imaging, reached an all-time high at $60.60 in 2006 and sold off at $5.36 during the economic collapse in 2008. A bounce in 2011 stalled in the low-20s, followed by a decline that gathered force in 2014 and 2015. Selling pressure eased in November 2016 when the stock issued a one-for-four reverse split, triggering an all-time low at 42 cents.
The stock climbed in a January Effect rally that mounted base resistance in February at $1.10. The upside stalled a few days later at $1.64. Price action since then witnessed a pullback followed by a rally.
The turnaround set the stage for a rally high, followed by trend continuation that could find resistance at $3.50.
The company operates through four segments: packaging and printing group, plastics group, digital group and technology management.
10. Radiant Logistics, Inc.
Radiant Logistics, Inc., which engages in the provision of domestic and international freight forwarding services, and truck brokerage services, went public in 2006 at 95 cents and hit an all-time low at 9 cents at the end of the bear market. It recovered and reached an all-time high in June 2015 at $8.00, followed by an intermediate correction which extended into the second half of 2016, pushing down the stock to a $2.45 2-year low.
The stock recovered in November, stalling in February at $5.96. A March decline settled at the 50-day EMA mid-month. The stock has not yet recovered, but relative strength cycles have favored an uptick that could send the price to the 2015 high in coming months.
The company operates through the U.S. and Canada geographical segments.