New York, New York (PressExposure) March 01, 2012 -- Sasha Cekerevac, co-editor of Penny Stock Detectives, believes that there are two ways to look into the future price movement of penny stocks. In a recent Penny Stock Detectives article, Cekerevac argues that looking at the recent past of a penny stock firm's corporate earnings coupled with some basic technical analysis will provide the insight needed to predict future price movements.
Cekerevac explored the many reasons why a firm's share price is traded as a penny stock. Some are new firms that lack the national spotlight and start out as a penny stock. Some are big firms that have fallen on hard times, as their corporate earnings have shrunk and the firm is contracting.
"It is very important to understand not only why a firm is trading as a penny stock, but also what the future holds," comments Cekerevac. "The corporate earnings of a penny stock that you might be interested in should be either moving up or turning around from a decline. A firm that has had recent problems will see its corporate earnings decrease quarter after quarter. This is a dangerous time to buy a penny stock; it's called 'catching a falling knife,' to describe how difficult it can be to predict when a company's corporate earnings will turn around. Looking at the technical analysis, the same can be said if a penny stock continues to go down day after day, month after month; no one can know for sure when it will stop."
Cekerevac observed that when a penny stock gains traction, one of the basic technical analysis indications is a strong move above the trendline. In his recent article, he points out that, once the penny stock breaks above the trendline, this key indicator in technical analysis shows that the penny stock has become attractive to more buyers than sellers. And, when a penny stock starts to gain traction, it can often move very fast and for large profits.
"Investing in a penny stock can be tricky, but with enough knowledge and information from sites such as Penny Stock Detectives, there are large profits to be made," notes Cekerevac.
Many people think profiting from a penny stock is only for the professionals. Cekerevac says: why let them make all the money? Some research into basic areas of a penny stock, such as its corporate earnings and its technical analysis profile, can provide the early stages of research for a potential investor to weed out the strong candidates from the ones you should avoid.
Published every business day, Penny Stock Detectives researches and analyzes low-priced opportunities in the stock market and individual stock market sectors. Penny Stock Detectives reports on penny stocks, small-cap stocks, micro-cap stocks, high-profit potential plays mostly under $10, and the stock market in general. To see the full article and to learn more about Penny Stock Detectives, visit www.pennystockdetectives.com.
The editors of Penny Stock Detectives believe low-priced stocks, when researched properly, present investors with great opportunities to accumulate wealth and to increase the value of their investment portfolios. You can learn more about Penny Stock Detectives at www.pennystockdetectives.com.