Artificial Intelligence Penny Stocks

Artificial Intelligence (AI) penny stocks represent a high-risk, high-reward segment of the stock market, where shares trade at relatively low prices — often below $5. These stocks are typically associated with small, yet innovative companies focusing on integrating AI into various products and services. For investors and traders, these stocks offer a speculative opportunity to get in on the ground floor of potential technological breakthroughs. However, due to their volatility and these companies’ early stage, they require rigorous analysis and a keen eye for market trends.

10 AI Stocks to Watch

My top AI stock picks for May — rated on chart pattern, price action history, and catalyst — include the following:

Stock Ticker	Company	Performance (YTD)
NASDAQ: WISA	WiSA Technologies	– 68.88%
NASDAQ: SMCI	Super Micro Computer Inc	+ 202.15%
NASDAQ: PRZO	Parazero Technologies Ltd	– 8.41%
NASDAQ: ONFO	Onfolio Holdings Inc	+ 0.37%
NASDAQ: SPRC	SciSparc Ltd	– 72.50%
NASDAQ: APP	Applovin Corp	+ 81.98%
NYSE: SNAP	Snap Inc	– 6.75%
NASDAQ: AXTI	AXT Inc	+ 21.46%
NYSE: PLTR	Palantir Technologies Inc	+ 32.51%
NASDAQ: AISP	Airship AI Holdings Inc	+ 360.00%

You can see how the plan with AI penny stocks is rarely buy-and-hold…

Trading these penny stocks should be approached with a clear strategy and an understanding of the risks involved.

Jump ahead to get to my trading plans for these top AI stocks!

What Are AI Stocks?

AI stocks encompass shares of companies that are engaged in the research, development, and commercialization of artificial intelligence technology. These can range from large tech conglomerates to niche startups, each offering their unique contribution to the advancement of AI. 

Putting these securities in your portfolio means putting money behind the transformative potential of AI to revolutionize industries, from healthcare to finance, and beyond. These stocks are attractive to investors looking to capitalize on the growth of smart technology and automation. However, as with any investment, they come with varying levels of risk and exposure to the rapidly evolving tech landscape, where today’s leader can quickly become tomorrow’s obsolete player.

What Is Artificial Intelligence?

Artificial Intelligence (AI) is a game-changer in today’s world. It’s a technology that enables machines to mimic human intelligence. AI is not just about robots; it’s about software, algorithms, and machine learning. It’s about creating systems that can learn, adapt, and potentially act autonomously. AI is used in a wide range of sectors, from self-driving cars to advertising, and it’s transforming the way businesses operate.

AI is also making waves in the stock market. It’s being used to analyze vast amounts of data, predict market trends, and make trading decisions. AI is not just for big tech companies like Microsoft; it’s also being used by penny stock companies to drive growth and innovation. But remember, while AI has the potential to revolutionize industries, it also comes with risks. As traders, we need to understand these risks and make informed decisions.

Advantages of Trading AI Stocks

AI penny stocks can be bought at a low cost, offering traders an entry point into the innovative world of artificial intelligence without a hefty initial investment.

Trading AI stocks can offer several advantages. One of the key benefits is the potential for high growth. AI is a rapidly expanding sector, and companies that are developing innovative AI solutions can see significant growth. This growth can translate into an increase in share price, providing opportunities for traders to make gains.

However, trading AI stocks is not without risk. These stocks can be volatile, and there’s always the risk of losses. But remember, as traders, we don’t fear risk; we manage it. We use tools and strategies to limit our losses and maximize our gains. We don’t just blindly invest in AI stocks; we trade them based on patterns, data, and market insights.

The AI sector’s expansion offers traders the chance to ride the wave of companies at the forefront of innovation. With AI transforming industries, the stocks that stand out are those with solid use cases and robust technology. For those looking to keep their portfolios as sharp as their trading strategies, studying up on the past top artificial intelligence stocks to watch is key. This list not only highlights the movers and shakers of early 2023, but also provides insights into why they were the ones to watch.

What To Look for in an Artificial Intelligence Penny Stock

Due to their nature, AI penny stocks are subject to significant price volatility, which requires traders to stay vigilant and responsive to market changes. These stocks require thorough research and due diligence, as the AI field is rapidly evolving and can significantly impact stock values.

When diving into AI penny stocks, it’s not just about spotting the right chart patterns or trading volumes. It’s about understanding the underlying technology and its market potential. Knowing what makes an AI company stand out can be the difference between a savvy trade and a shot in the dark. For a deeper dive into the critical factors that can signal a strong AI penny stock, this guide on what to look for in publicly traded AI companies’ stocks is an invaluable resource for traders aiming to make informed decisions.

Here’s the step-by-step:

Exhibits a Tradeable Pattern on its Stock Chart

First, look for a tradeable pattern on the stock chart. Patterns can give us insights into potential price movements. For example, a breakout pattern could indicate that the stock price is about to rise. But remember, patterns are not guarantees; they are just one tool we use to make trading decisions.

Is a Low-Float Stock

Second, consider whether the stock is a low-float stock. Low-float stocks have fewer shares available for trading, which can lead to higher volatility and potentially higher gains. But be careful, high volatility also means higher risk.

Exhibits an Unusual Trading Volume

Third, look for unusual trading volume. A sudden increase in trading volume could indicate that something significant is happening with the company, such as a new product launch or a major contract win.

Is a Former Runner

Fourth, check if the stock is a former runner. Former runners are stocks that have had significant price increases in the past. These stocks can potentially run again, providing opportunities for gains.

Gets Frequent Media Attention

Finally, pay attention to media coverage. Stocks that get frequent media attention can see increased investor interest, which can drive up the share price.

Where To Buy AI Penny Stocks

AI penny stocks may provide high return potential, but it’s crucial to understand where and how to engage with these investment opportunities. They are often less liquid than higher-priced stocks, making it essential to plan entry and exit strategies carefully.

There are several places where you can buy AI penny stocks.

NYSE/Nasdaq Penny Stocks

You can find AI penny stocks on major exchanges like the NYSE and Nasdaq. These stocks are subject to strict listing requirements, which can provide a certain level of security for investors.

OTC Penny Stocks

You can also find AI penny stocks on the Over-the-Counter (OTC) market. OTC stocks are not subject to the same listing requirements as NYSE/Nasdaq stocks, which can make them riskier. But remember, with higher risk comes the potential for higher returns.

The Best Place to Buy Tech Penny Stocks

The best place to buy tech penny stocks depends on your trading strategy and risk tolerance. Some traders prefer the security of NYSE/Nasdaq stocks, while others are willing to take on the risk of OTC stocks for the potential of higher returns.

10 Best AI Stocks for April 2024

My best AI stocks to watch are:

• NASDAQ: WISA — WiSA Technologies — The Wireless Sound Penny Stock With Partnership News
• NASDAQ: SMCI — Super Micro Computer Inc — The Volatile Mega-Cap Stock That’s Set For Earnings
• NASDAQ: PRZO — Parazero Technologies Ltd — The Israeli Drone Safety Penny Stock 
• NASDAQ: ONFO — Onfolio Holdings Inc — The Holding Company With an AI Pump in Its Past
• NASDAQ: SPRC — SciSparc Ltd. — The AI Biotech Penny Stock
• NASDAQ: APP — Applovin Corp — The IRIS Swing Pick That’s Been Pulling Back
• NYSE: SNAP — Snap Inc — The Potential Winner of the TikTok Ban
• NASDAQ: AXTI — AXT Inc. — The Earnings Winner With Good Consolidation
• NYSE: PLTR — Palantir Technologies Inc — The AI Stock Leader That’s Holding Support
• NASDAQ: AISP — Airship AI Holdings Inc — The AI Stock With a Government Contract

AI was one of the hottest sectors in 2023… 

My students have watched hot runners like AMST, PBTS, POAI and more. More importantly, they’ve managed to stay safe because they remember the rules of trading…

These companies are leveraging AI technology and analytics to drive growth and innovation. But remember, just because a company is in the AI sector doesn’t mean it’s a good investment. Always do your research and make informed trading decisions.

AI penny stocks can be part of a diversified investment portfolio, offering a balance between traditional investments and the cutting-edge technology sector. They benefit from advancements in AI technology, which can lead to significant growth as new applications are discovered and implemented.

Here’s the AI stock cheatsheet:

• What is the most promising AI stock?

A sector leader like NVIDIA Corp (NASDAQ: NVDA) is the best bet for the most promising AI stock. But remember, we’re traders, not investors. So the stocks on this list are ones we’re watching for short-term moves, not predictions of which will lead stock exchanges in 2030.

• What are the top 3 AI stocks to buy now?

My top 3 AI stocks to buy now (as long as their price action is strong) are Microsoft Corporation (NASDAQ: MSFT), Super Micro Computer, Inc (NASDAQ: SMCI), and CrowdStrike Holdings, Inc. (NASDAQ: CRWD).

• Which company is most advanced in AI?

NVIDIA is the most advanced publicly traded company in AI, that’s why it’s the sector leader. But other leading tech stocks like Apple, Microsoft, Google, and Facebook are all safe bets to pull ahead at some point.

• Which Artificial Intelligence stocks have a “Strong Buy” analyst rating?

Analysts tend to love these tech leaders — NVIDIA, Apple, Microsoft, Google, and Facebook. Most analysts have rated all of these stocks as “strong buys.”

Before you send in your orders, take note: I have NO plans to trade these stocks unless they fit my preferred setups. This is only a watchlist.

The best traders watch more than they trade. That’s what I’m trying to model in this article. Pay attention to the work that goes in, not the picks that come out.

Sign up for my NO-COST weekly watchlist to get my latest picks!

1. WiSA Technologies (NASDAQ: WISA) — The Wireless Sound Penny Stock With Partnership News

My first AI stock pick is WiSA Technologies (NASDAQ: WISA).

On April 16, the company announced an additional license with a “multi-billion dollar revenue company” for its immersive audio technology. 

And Breaking News subscribers had eyes on it before the market opened.

I can’t stress the importance of this tool enough. For small-account traders, Breaking News alerts us of the hottest plays before most of the market has eyes on it.

Then we wait for the chart to match one of our trading patterns.

Take a look at the chart below with the alert details. Every candle represents one trading minute:

It pays to have eyes on these plays early. But these stocks CAN run for multiple days.

For example, WISA spiked higher after April 16. The total move measures 920%*.

And we’re seeing runners like this every single week in this 2024 market!

Here’s where you can find the next Breaking News trade alert.

Why I Like It

The stock is still holding some of its gains. That’s a hint that it could push higher!

Take a look at the chart below that shows resistance-turned-support at the $4 level, every candle represents five minutes:

Plus, StocksToTrade shows that the stock’s float is only 1.4 million shares.

Anything below 10 million shares is considered a low float. Also known as a low supply of shares.

The low supply helps the share price spike higher when demand increases.

It essentially increases the volatility of the stock. Keep an eye on this runner as it works back toward the breakout level.

2. Super Micro Computer Inc (NASDAQ: SMCI) — The Volatile Mega-Cap Stock That’s Set For Earnings

My second AI stock pick is Super Micro Computer Inc (NASDAQ: SMCI).

On March 5 we learned that SMCI would join the S&P 500 this year. That’s BIG news for a mega-cap stock.

Now, we usually trade low-priced stocks. Not stocks like SMCI, where the share price is over $800.

Cheap stocks are attractive because:

• We can load up on shares.
• The low price helps the stock spike higher from a percentage perspective.

Higher priced stocks like SMCI aren’t known to surge like volatile penny stocks.

But the AI and tech sectors are so hot in 2024, we’re seeing huge moves from big stocks like SMCI.

In a lot of ways, SMCI acts as a tech sector leader. We can gain insight on low-priced trade opportunities by watching this big runner.

Why I Like It

Right now I’m watching SMCI because it’s leading the pack.

If SMCI dips, the tech plays in our niche might not spike as high.

If SMCI pushes higher, we have to take advantage of that bullish momentum while it lasts.

In 2024, SMCI prices spiked 330%* despite starting the year above $250 per share. Look at the insane move so far this year. And pay attention to the support level at $700.

On the chart below, every candle represents one trading day:

Also, on April 30 we learned the company’s earnings for the fiscal quarter that ended in March of this year.

Pay attention to the trend of the price action as a result of the earnings! That’s the kind of data that will trickle down to our low-priced niche.

Speaking of which:

When large-cap stocks like SMCI behave like volatile penny stocks, we can trade them for lower prices using options.

Now, at the mention of “options” a lot of traders shy away.

You’re free to trade volatile low-priced runners. But options aren’t as confusing as you might think:

An option is a contract that gives you the right to buy or sell shares of a stock.

Theoretically: If you think SMCI is going to trade higher in the future, you could buy a contract and then sell it after SMCI spikes without actually buying any shares of SMCI.

The value of the contract is what we’re trading, not the actual stock.

And there IS a process for profits. For example, Ben Sturgill is a renowned options trader with verifiable profits. Take a look at his process.

There are so many opportunities to profit in this 2024 market.

Pick a strategy that makes sense to you and hit the ground running!

3. Parazero Technologies Ltd (NASDAQ: PRZO) — The Israeli Drone Safety Penny Stock 

My third AI stock pick is Parazero Technologies Ltd (NASDAQ: PRZO).

Unfortunately, the weekend of April 13 and 14, the Middle Eastern conflict escalated.

Specifically between Israel and Iran. Israel had attacked an Iranian consulate earlier in April, and we learned of an incoming Iranian retaliatory strike the Friday of April 12.

PRZO is an Israeli drone company, and the stock has a history of spiking in relation to the recent tension between Israel and Hamas. The price spiked 460%* when Hamas first attacked on October 7, 2023.

When we learned of escalating tension between Israel and Iran on April 12, PRZO was an obvious watch.

There’s a chart below of the price action, every candle represents one trading day:

Why I Like It

The spike in October ‘23 is the reason I had the foresight to alert traders of a possible weekend play.

As of now … the Middle East tensions don’t show signs of cooling.

And as a result, we could see PRZO react to more news in the future. Keep an eye on the most recent breakout level around $1.30.

4. Onfolio Holdings Inc (NASDAQ: ONFO) — The Holding Company With an AI Pump in Its Past

My fourth AI stock pick is Onfolio Holdings Inc (NASDAQ: ONFO).

In June 2023 this company announced its intent to increase an AI business presence through acquisitions and by leveraging certain subsidiaries.

The chart didn’t spike like some of its peers in the same sector. Remember, the AI sector burst on the scene early in 2023. Other AI stocks like C3.ai Inc. (NYSE: AI) were ripping higher.

But I’m still watching ONFO right now.

Why I Like It

The company obviously knows what’s hot.

They tried to inflate the price with an AI press release in June of 2023. That’s only a few months after the AI craze began.

Plus, the stock is prone to volatile spikes:

StocksToTrade shows that the float is only 3.2 million shares … 

ONFO is a powder keg that’s waiting for the perfect spark.

5. SciSparc Ltd. (NASDAQ: SPRC) — The AI Biotech Penny Stock

My fifth AI stock pick is SciSparc Ltd. (NASDAQ: SPRC).

This stock combines the two hottest sectors in the market.

• AI
• Biotech

The company’s venture, MitoCareX, unveiled a cancer-molecule discovery using AI on March 21.

It seems there’s a new batch of biotech stocks spiking every week right now. The biotech sector has been hot in the past. It’s not a huge surprise to see these stocks spiking again. 

But it’s very exciting when we find stocks with a foot in two hot sectors instead of one.

Why I Like It

Besides the double sector, SPRC has an incredibly low float.

StocksToTrade shows only 258k shares.

The chart also shows a huge history of spiking in 2023. Past spikers can spike again. 

Take a look below, every candle represents one trading day:

Similar to ONFO, SPRC is a powder keg waiting for the next hot catalyst.

6. Applovin Corp (NASDAQ: APP) — The IRIS Swing Pick That’s Been Pulling Back

My sixth AI stock pick is Applovin Corp (NASDAQ: APP).

IRIS is our AI stock picker.

Before I learned about the profit opportunities among small-cap spikers, I would swing trade larger stocks.

It’s still a viable strategy. Especially in this insane 2024 market. And thanks to AI, I was able to automate it.

IRIS scans the market to find stocks that match my swing trading framework.

Now, some of these plays are higher priced … That’s because they’re real companies with real financials and revenue.

Compared to volatile penny stocks, which are usually just crap businesses in disguise. That’s why we swing trade higher-priced plays and only day trade volatile penny stocks.

A trader’s profit angle in the market depends on what works best for them. I included both kinds of opportunities in this watchlist because there’s SO MUCH opportunity right now.

Why I Like It

The price gapped up on February 15 after fourth-quarter financial data surpassed expectations. 

The company attributed a fair chunk of its success to a brand new AI advertising engine. Ever since the announcement, prices continued to climb. The entire move already measures 65%.

Prices pulled back a bit in April, but it could be setting up a perfect entry above support around $65. Take a look at the chart below, each candle represents one day:

The intraday moves for higher priced stocks aren’t as explosive. That means we don’t have to watch our swing-trade positions as closely.

This is a viable strategy for traders right now. It all depends on what works best for YOU.

APP is IRIS’s favorite swing trade setup right now.

Click here for the full trade breakdown.

7. Snap Inc (NYSE: SNAP) — The Potential Winner of the TikTok Ban

My seventh AI stock pick is Snap Inc (NYSE: SNAP).

TikTok is on the chopping block in 2024.

President Joe Biden signed a bill on Wednesday, April 24 that forces the U.S. TikTok to find a U.S. owner … or leave the U.S. entirely.

Why I Like It

SNAP is a social media platform that’s already popular and headquartered in the U.S., Santa Monica, California.

On Thursday, April 25 the stock spiked 40% when SNAP announced bullish earnings during after hours.

On the chart below, every candle represents one trading minute:

SNAP isn’t necessarily eyeing a TikTok purchase, but it’s definitely a direct business rival.

• If TikTok leaves the U.S. it’s likely that Snpachat will pick up some users.
• If someone in the U.S. buys TikTok, the software switch could still cause users to leave the platform for Snapchat. Similar to the debacle that happened when Elon took over Twitter/X.

Keep an eye on other U.S. social media companies too, like META Platforms Inc. (NASDAQ: META).

8. AXT Inc. (NASDAQ: AXTI) — The Earnings Winner With Good Consolidation

My eighth AI stock pick is AXT Inc. (NASDAQ: AXTI).

On Thursday, February 22 during the afternoon, AXTI held an earnings call.

This is a direct excerpt from the call:

“Sales grew 10% in the quarter with early signs of recovery in the power market and brand new demand related to artificial intelligence.”

– Dr. Morris Young, Chief Executive Officer of AXTI

Shares started to move during after-hours. It gapped up the next morning and continued in the following days. The initial spike measures 130%.

But the stock took a massive dive on April 4 after we learned that the company was under investigation.

Apparently, AXTI has a subsidiary that does business in China. The company attempted to IPO on Chinese markets but was blocked by the government for legal reasons … possibly relating to falsifying data, tax evasion, unsafe chemical storage, etc. …

Why I Like It

There’s another earnings report scheduled for May 2.

Now, I know what you’re thinking, “Tim, this company could be absolute garbage. China doesn’t even want it.”

Friends, look around. ALL of these penny stock companies are garbage. That’s why they’re penny stocks.

But we can trade the bullish momentum for short-term profits using popular patterns.

AXTI has already shown its history of spiking and volatility. It’s likely we’ll see more volatility in the future. Get ready for May 2 … 

9. Palantir Technologies Inc (NYSE: PLTR) — The AI Stock Leader That’s Holding Support

My ninth AI stock pick is Palantir Technologies Inc (NYSE: PLTR).

There’s a growing concern about AI’s utilization by scammers, criminals, and enemies of the state to disrupt and prey on our society at large.

For example, hopefully you weren’t the victim of a scam like the one below:

As a result, companies like PLTR have to increase the strength of their services to combat this growing risk.

Why I Like It

This niche is essential in the AI industry.

And PLTR is a front runner.

In November ‘23, the company announced it had secured 80 new deals in the third quarter of 2023.

Each deal was valued at $1 million or more. That’s pretty easy math … More than $80 million in new business deals.

The stock spiked up to $22 within the month.

Then on February 5 an earnings report came out while the market was closed. The next day, prices gapped up 20% and continued the spike to an impressive 50% in the following days.

More recently, prices dipped, take a look at the daily chart below:

PLTR reacts well to bullish news.

I’m waiting for the next hot catalyst to move this stock. And thanks to the price dip, we can find solid support more easily.

10. Airship AI Holdings Inc (NASDAQ: AISP) — The AI Stock With a Government Contract

My tenth AI stock pick is Airship AI Holdings Inc (NASDAQ: AISP).

On March 5 at 8:31 A.M. Eastern, AISP announced a new government contract with the U.S. Department of Justice.

Government news is HUGE for a penny stock.

The spike already measures 760%.*

Why I Like It

Nobody knows how far these plays could run.

AISP announced this news in early March, but the chart is still consolidating all this time later. Take a look at the chart below:

Plus, StocksToTrade shows that the float is only 11 million shares. That’s close enough to our goal of 10 million shares or fewer.

AISP is one hot catalyst away from ripping higher.

AI Stocks Under $5

The allure of hot sector stocks, especially when they’re also penny stocks, is undeniable. These stocks present a unique blend of opportunity and volatility. The AI industry is booming, with advancements and applications spreading across various sectors, from healthcare to finance, making AI stocks a magnet for investors looking for the next big thing. The gains here can be proportionately greater than those from more established stocks, mainly because even minor positive news or advancements can send their prices soaring.

However, it’s crucial to approach these opportunities with a clear strategy and an understanding of the risks involved. The volatility of penny stocks, combined with the speculative nature of AI ventures, means that while the potential for rapid gains is significant, the risk of losses is equally high. Conduct thorough research, looking beyond the hype. And never invest in these stocks — only trade them.

Remember, the key to success in trading AI stocks under $5 is not just about jumping on every opportunity but being selective and strategic. It’s about leveraging the explosive potential of the AI sector while managing risk meticulously. By focusing on companies with the potential to lead in their niche, traders can capitalize on the disproportionate gains that these penny stocks offer, all while keeping their investment strategy tight and cutting losses quickly.

Key Takeaways

Trading AI penny stocks can offer opportunities for gains, but it also comes with risks. As traders, we need to understand these risks and make informed decisions. We don’t just blindly invest in AI stocks; we trade them based on patterns, data, and market insights. And remember, small gains add up. Don’t get caught up in the hype of AI; focus on the facts, the data, and the patterns. That’s how we trade AI penny stocks.

Key points:

• Investing in AI penny stocks can be risky due to lack of company information, making transparency and communication key factors to consider.
• These stocks could experience rapid growth with AI sector advancement, positioning them as attractive for those looking to capitalize on technological trends.
• AI penny stocks are influenced by technological developments and patents, which can dramatically alter their trajectory and market value.

These stocks follow the rules of all hot sectors. They’re good for trading because they’re hot…

That’s the same thing that makes them dangerous when their sector cools down.

It isn’t enough to form a thesis on which stocks to buy. Making a profit depends on a good trading plan.

And that depends on your stock research and analysis tools.

I use StocksToTrade to scan for news, tweets, earning reports, and more — all covered in its powerful news scanner. 

It has the trading indicators, dynamic charts, and stock screening capabilities that traders like me look for in a platform. It also has a selection of add-on alerts services, so you can stay ahead of the curve.

Grab your 14-day StocksToTrade trial today — it’s only $7!

Trading can be dangerous. Most traders lose money.

A 2019 study called “Day Trading for a Living?” looked at the success rates of Brazilian traders over a 2-year window, and found that 97% of traders with more than 300 days of active trading lost money. Only 1.1% earned more than the Brazilian minimum wage — that’s only $16 per day!

If you want to be part of the 1%, make sure you outwork the rest!

What AI penny stocks do you have on your watchlist? Let me know in the comments!

FAQs

How can AI platforms like ChatGPT contribute to the growth of penny stocks in the AI industry?

AI platforms like ChatGPT and related applications are driving significant innovation in various industries. The growing demand from customers for AI-driven solutions is leading to increased market cap and revenues for companies in the AI space, including those whose shares are classified as penny stocks.

Where can I find the latest news and information about AI penny stocks?

For the latest news and market updates on AI penny stocks, you can explore our markets section. It provides in-depth content, links to reliable sources, and recent results related to AI companies and their stocks.

How can I assess the value of an AI penny stock?

The value of AI penny stocks can be assessed by evaluating several factors. These include demand for AI solutions, people involved in the company, and its market cap. Revenue, earnings, and momentum of the stock in the market are also crucial considerations.

When should I consider selling my AI penny stocks?

Deciding when to sell your AI penny stocks involves evaluating your profit margins and market conditions. It’s generally a good idea to sell if you’ve achieved your desired profit or if there are signs of a downturn in the market. Always consult with a financial advisor to make the most informed decisions.

*Past performance does not indicate future results