People keep asking me for the top Robinhood penny stocks to watch. I understand. You want to make boatloads of cash without doing any work.
OK, that sounds harsh. But I’ve seen what’s out there and heard the horror stories. I think it’s my responsibility to let you know.
Since you’re here, let’s talk about trading penny stocks on Robinhood — the good, the bad, and the ugly.
Robinhood has taken the industry by storm. It’s made it easier for new traders to enter the trading game. It’s also branded itself as THE “free” trading platform. (Nothing’s ever really free.)
It caught a lot of buzz — and not all good — after the GameStop (NYSE: GME) short squeeze.
Let me be straight. Robinhood is not my go-to platform for trading penny stocks. But I’m glad it’s inspiring new people to build a skill that has the potential to change their future.
So today I’ll dedicate this post to trading penny stocks on Robinhood — with a healthy dose of honesty. Let’s do this!
Table of Contents
- 1 Can You Buy Penny Stocks With Robinhood?
- 2 List of 10 Hot Penny Stocks on Robinhood in July 2021
- 2.1 Robinhood Penny Stocks to Watch #1: Adamis Pharmaceuticals Co. (NASDAQ: ADMP)
- 2.2 Robinhood Penny Stocks to Watch #2: Aerpio Pharmaceuticals Inc. (NASDAQ: ARPO)
- 2.3 Robinhood Penny Stocks to Watch #3: Broadway Financial Corporation (NASDAQ: BYFC)
- 2.4 Robinhood Penny Stocks to Watch #4: Outlook Therapeutics Inc. (NASDAQ: OTLK)
- 2.5 Robinhood Penny Stocks to Watch #5: Powerbridge Technologies Co. Ltd. (NASDAQ: PBTS)
- 2.6 Robinhood Penny Stocks to Watch #6: Senseonics Holdings Inc. (AMEX: SENS)
- 2.7 Robinhood Penny Stocks to Watch #7: VEON Ltd. (NASDAQ: VEON)
- 2.8 Robinhood Penny Stocks to Watch #8: (NASDAQ: VERB)
- 2.9 Robinhood Penny Stocks to Watch #9: VistaGen Therapeutics Inc. (NASDAQ: VTGN)
- 2.10 Robinhood Penny Stocks to Watch #10: Exela Technologies Inc. (NASDAQ: XELA)
- 3 Types of Penny Stocks on Robinhood
- 4 How to Find Penny Stocks on Robinhood
- 5 How to Choose Penny Stocks on Robinhood
- 6 How to Trade Penny Stocks on Robinhood
- 7 Robinhood Penny Stocks to Watch: How to Make Your List of Penny Stocks
- 8 Should You Trade Penny Stocks on Robinhood?
- 9 How to Manage Risk on Robinhood
- 10 Can You Get Rich Trading Penny Stocks?
- 11 Frequently Asked Questions About Robinhood Penny Stocks
- 12 Robinhood Penny Stocks to Watch: Conclusion
- 13 One Platform. One System. Every Tool
Can You Buy Penny Stocks With Robinhood?
It depends on which penny stocks you’re after. If you’re looking for stocks on the Nasdaq or NYSE exchanges, you can access these stocks on Robinhood.
But it’s not great news if you’re into OTCs or pink sheets. Robinhood doesn’t have access to OTCs on its platform.
That said, I put together a list of penny stocks you can find on Robinhood.
By the way, you can join me for my no-cost premarket sessions to build better watchlists every day. Access the full archive here and sign up for daily recaps!
List of 10 Hot Penny Stocks on Robinhood in July 2021
As of mid-July, these 10 Robinhood stocks show some watchlist potential.
I can’t claim any of them are fundamentally good companies … But all of them have some hype. And maybe they have potential for momentum or interesting price behavior on their charts.
Remember to only use this list of stocks to watch as a guide. Be sure to regularly scan the market for additional opportunities. Always do your due diligence before every trade and never risk more than you can afford to lose.
Robinhood Penny Stocks to Watch #1: Adamis Pharmaceuticals Co. (NASDAQ: ADMP)
Industry: Drug Manufacturers
We saw ADMP spike in January. It made it from the sub $1 to above $2. Since then, I’ll admit it’s been a bit of a snooze fest.
It’s back on my July watchlist because it’s been holding highs above $1 for a month. The chart below shows it struggling at that key support level.
I’d stay out of it until it shows it can regain some momentum. It definitely has to show me that it can defend the $1 level again.
It’s good to keep your eye on. Not the most exciting play — but things can heat up fast.
Robinhood Penny Stocks to Watch #2: Aerpio Pharmaceuticals Inc. (NASDAQ: ARPO)
This is a great example of a breakout over 52-week highs. When it comes down to it, playing patterns is one of the best ways to trade. And breakout patterns are great.
It’s important not to get sucked into these gap-up stocks. That’s why I suggest waiting until 9:45 a.m. Eastern to trade. It can be hard to tell which way they’ll go right at the market open. My best advice is to just relax and react to what the market shows you.
Some people on Twitter are hyping this stock up. Apparently, HC Wainwright & Co. upgraded the stock to a buy with a price target of $22. For a $2 stock, that’s a big deal.
But who knows if the news would have been enough to spike it or if it’ll continue to run. It’s still under investigation for possibly breaking the law … sketchy. Stay vigilant and remember to react.
Robinhood Penny Stocks to Watch #3: Broadway Financial Corporation (NASDAQ: BYFC)
This is a classic sympathy play.
On July 8, Carver Bancorp Inc. (NASDAQ: CARV) had a massive short squeeze. It spiked 251%. As the price kept climbing, shorts had to buy to cover at higher prices. It was a tidal wave of buying.
When a stock spikes big like that, stocks in the same industry spike too. Sympathy plays can be great catalysts.
The chart’s pretty interesting too. It has great volume. It’s coming up on resistance at $3.50. If it manages to break that resistance level, we could see opportunities for profit.
But be careful. I’m not the biggest fan of banking plays. There have been a lot of failed spikers recently. Obviously, CARV is an exception.
Of course, it’s not a done deal. As with everything in the market.
Robinhood Penny Stocks to Watch #4: Outlook Therapeutics Inc. (NASDAQ: OTLK)
Here’s another one I like because of the pattern. Do you detect a pattern of patterns?
The bottom line: OTLK has run before. It went from the $1s to the $3s. Since then it’s held highs for five months. Recently, it even started a bit of an uptrend.
It has some resistance to chew through right under $3. But if it spikes past, I think we could see it reach past highs. Maybe even a break of the 52-week highs. This is another one to keep your eye on for any increased momentum toward the highs.
Robinhood Penny Stocks to Watch #5: Powerbridge Technologies Co. Ltd. (NASDAQ: PBTS)
If this all sounds new and slightly unbelievable, then let me tell you it’s true. If you’d like an example look no further than PBTS.
It ran a few months ago but has a history of being a one-day spiker. Now it might be gaining some momentum. Watch for this one to hold key support and resistance levels. Maybe we’ll finally see it go on a run.
Robinhood Penny Stocks to Watch #6: Senseonics Holdings Inc. (AMEX: SENS)
Industry: Medical Diagnostics & Research
We’ve talked about it before and we’re going to talk about it again — yep, it’s patterns! Exciting, right?
This stock has spiked in the past. Right now it’s bobbling between $3 and $4. Remember, this is just a watchlist. I don’t know if these stocks will make for good trades or not. For instance, look at SENS.
It might be putting in a double bottom at $3. But who knows? Anything can happen in the market. This thing could fall through and tank to the low $2s. Be careful with your trades and manage risk accordingly.
I’d like to see this one perk back up before considering a trade. Wait to see strength and then react patiently with a planned entry.
Robinhood Penny Stocks to Watch #7: VEON Ltd. (NASDAQ: VEON)
Industry: Telecommunication Services
This is another breakout stock that spiked on news. It sold the stake in its subsidiary Omnium Telecom Algérie.
That may not seem like the most exciting catalyst but VEON stands to get a lot of money from the deal. They also claim that now the business will be more streamlined and they will be able to focus more on ‘core markets’.
From a day trading perspective, I don’t care about the outcome of the company. I’m looking at the potential to make money now. With stocks like this, it’s in and out.
With that said, I wouldn’t touch this until it shows it can hold the breakout level and attempt to make new highs.
Robinhood Penny Stocks to Watch #8: (NASDAQ: VERB)
This is a video marketing stock that sells its platforms all around the world. The news that spiked it higher was similar to Aerpio Pharmaceuticals Inc. (NASDAQ: ARPO).
On Monday, June 28, Ascendiant Capital analyst Edward Woo rated the stock a buy with a target price of $4. It took a few days for the news to sink in, and then it spiked.
There are still some bag holders from a few months ago, but the stock held its highs pretty well. Now it’s chugging along back toward resistance from a few days ago. This one will be interesting to watch.
Robinhood Penny Stocks to Watch #9: VistaGen Therapeutics Inc. (NASDAQ: VTGN)
This is another breakout play. It’s spiking on fiscal year financial results and corporate updates. Everything sounds positive and the company seems excited about the future. That’s all it takes for some of these penny stocks.
Now VTGN has broken through. We’ll have to see if it continues to climb and bounce off resistance. Nothing’s certain. This thing could still dump, so be careful.
Robinhood Penny Stocks to Watch #10: Exela Technologies Inc. (NASDAQ: XELA)
Meme stonks … there’s nothing quite like them. Here’s another example of the Reddit army’s hard work.
It spiked back in March then died off and has been hibernating ever since. But now the battle cries of a thousand Reddit day traders have refueled the engines.
I’m not saying it’s a sure thing. But we’ve seen meme stonks spike big before. I’d keep this one on my watchlist to look for new highs.
Types of Penny Stocks on Robinhood
Robinhood is a retail-focused brokerage. That means it only allows clients to trade on major exchanges such as the NYSE and the Nasdaq.
There’s a ton of stocks below $5 on these exchanges. The problem is, you’re only getting part of the pie.
The OTC markets and pink sheets also offer a huge range of volatile penny stocks … But you’ll need a different brokerage account to trade them. Robinhood won’t cut it. Check out this post for the lowdown on how to find the best brokerage for you.
How to Find Penny Stocks on Robinhood
Don’t follow my stock picks blindly. You’ve gotta become self-sufficient. Sure, you can find penny stocks on Robinhood’s mobile app…
But I recommend creating your watchlists from your laptop — it’s a lot easier. Use a screener to search for stocks below $5. You’ll probably want to find some with volume too.
But it’s impossible for one person to watch every penny stock on Robinhood. So either grab a couple of friends to help you stare at hundreds of stocks … or choose a few that show good potential.
How to Choose Penny Stocks on Robinhood
Choosing penny stocks to trade requires a number of well-planned steps. Doesn’t matter which broker you use.
It’s all about finding hyped-up stocks. Then you ride the momentum and jump off before the move crashes. That can make it sound easy. It’s not. It takes years of education and planning to learn how to ride the momentum in this niche.
But here’s a quick overview…
First, look at stocks with hype. Maybe there’s a news catalyst that day. It could be trending on social media, or maybe it’s just a current hot stock.
Next, make sure that the stock’s daily trading volume is high enough to allow you to get in and out easily. Remember managing risk.
It’s also important to check the price action on the stock chart. Reading the chart can help you pick a perfect entry position. It can also show good places to set your stop loss and help you understand what the stock’s next move might be.
Chart reading doesn’t have to be complicated. In fact, many seasoned traders look for clean and simple chart patterns.
Keeping up with news, watching the charts, and analyzing trading volume can all be done on a number of different apps … But if you want to get serious about your trading, there’s a much more effective way to do all of these things…
Get a 14-day trial of StocksToTrade for just $7 for access to one of my most powerful stock trading tools on the planet. It’s your one-stop shop to help simplify your trading.
How to Trade Penny Stocks on Robinhood
If you’re gonna trade penny stocks on Robinhood — or anywhere else — you better know the restrictions.
Pattern Day Trading Rule
You have to keep the pattern day trading (PDT) rule in mind. This rule isn’t specific to Robinhood. If you have a small account, it can affect your trading.
The rule limits traders to no more than three day trades within a rolling five-day trading period. That is unless you have $25K or more in your trading account.
It can seem inconvenient — especially for new and excited traders — but it’s actually meant to protect you. Most traders lose money. The PDT rule tries to stop newbies from overtrading.
Try to see it as a good thing. It’ll force you to only focus on the best trades. That’s the best study tool there is.
Robinhood Day Trading Limit
The PDT rule can be a big problem for some traders. But again, I encourage you to see it as a good thing. No, you don’t have to listen to me…
Just like when I said that I didn’t think Robinhood had the best day trading software around. You can use it if it works for you. But understand that different brokers can work better for different people.
Don’t limit your options by choosing one just because it’s easy.
This is important, so pay attention. Do your research. Only you can decide which broker and trading platform are right for you.
You also need to figure out if you want access to extended-hours trading. That can also come with risk. I don’t recommend that for new traders.
What’s key is access to charts, watchlists, stock research, Level 2 data, and indicators. You can get all that and more with StocksToTrade. Plus you can trade right from the platform with our broker integration — and you can add on what’s arguably the trading chat room.
When you start trading you have a lot of decisions to make. So take your time. Make a detailed list of what matters to you, then find the right broker and trading platform.
Robinhood Penny Stocks to Watch: How to Make Your List of Penny Stocks
When you build the habit of searching for the best stocks and trading setups, you’ll quickly develop a list of stock tickers that’s long. It happens to every trader…
That’s where watchlists come in handy. It’s your personal collection of stock tickers that you think show potential. Most traders keep multiple watchlists, such as one for a certain sector and others for specific chart setups. How you organize it is all up to you.
Need help with your watchlists? Learn from my process every week. Sign up for my no-cost weekly watchlist and I’ll send you my top picks for the week every Sunday!
Should You Trade Penny Stocks on Robinhood?
Robinhood can be more popular with newer traders. But as traders progress past newbie status, they tend to switch to a more robust platform.
Whether you should use Robinhood to trade penny stocks is up to you. But before you make a decision, you should know the advantages and disadvantages that come along with it.
Let’s take a look at a few.
Free Trades: There are no commission fees with Robinhood trades — that’s one of its biggest draws. But realize they gotta make money somehow. And that could potentially affect the quality of your trade executions
No Account Minimum: Traders can start right away because there’s no account minimum.
Ease of Use: More people are on their smartphones a lot these days. Robinhood’s app can make signing up for and funding an account quick.
Streamlined Interface: One of Robinhood’s drawbacks is that it lacks the tools and resources other brokers have. But its focus on simplicity can be useful for less-knowledgeable traders. Just know that as your skill set expands, you’ll likely outgrow this platform.
Fractional Shares: Robinhood has fractional shares. That means traders can pay as little as $1 for a portion of a share, even if that share’s full price is hundreds of dollars.
No OTC Trades: One of the biggest disadvantages of using Robinhood is that it doesn’t allow OTC trades. If trading penny stocks is your strategy, that takes a huge amount of low-priced stock opportunities off your table.
Poor Phone Support: I haven’t tried Robinhood personally, but I know people who have. I hear a lot of reports that it’s difficult to get in touch with a human being. It looks like they’re starting to realize the importance of customer satisfaction. They’ve been expanding their live phone support to try to fix the problem. If you’re trading with real money, you want to know your broker will be there for you if you need help. Communication may be getting better at Robinhood, but seems to be slow going.
App Dependability: Look online and you’ll see complaints about Robinhood’s app reportedly failing at crucial times. This is a serious concern for traders using real money.
Limited Functionality: Robinhood lacks the tools and resources more experienced traders expect.
Potentially Delayed Data: Stock quote data may be delayed as much as 20 minutes. Yep, that’s a problem if you’re trading low-priced stocks. They move fast.
How to Manage Risk on Robinhood
In Hollywood movies, stock traders are often portrayed as high-octane risk-takers. But in reality, the habits of most successful traders aren’t quite as exciting.
The first thing smart traders think about before entering a trade is how to manage risk.
It means you don’t lose more money than your trading plan allows. It’s important to be able to exit positions easily with little stress. When you have a bad day in the market, at least you’ve done your best to protect your account and live to fight another day.
One way to manage risk is to set stop-loss levels. You can place an order with your broker to close a position if you lose too much money. For those disciplined enough, top traders set mental stops and manually close positions that hit loss limits.
Traders can place stop-loss orders from the Robinhood app. They should work as long as there’s enough trading volume in your stock.
Can You Get Rich Trading Penny Stocks?
I hate this question.
Look, you can get rich doing just about anything. Go to med school and become a brain surgeon. Sell the finest underwater woven baskets the world has ever seen. Brew kombucha in your garage. Pump penny stocks.
OK … some of those might be a stretch. My point is anything is possible.
But day trading is hard. Day trading penny stocks on Robinhood can be even harder.
It’s not impossible to get rich in this niche. But be realistic with your expectations. Nothing good ever came from laying around on your butt thumbing through stock pick articles.
If you’re serious about trading penny stocks, start taking your education seriously.
If you’re looking for mentorship, a trading education, and a trading community, come join the SteadyTrade Team. We connect live twice every trading day to watch the market and make solid trade plans. Join us!
Frequently Asked Questions About Robinhood Penny Stocks
Does Robinhood Really Give You a Free Stock?
As of now, yes, traders get a free stock when opening a Robinhood account. To me, it seems like another way the broker tries to entice users. But do your research. Check the terms and conditions, as they can change at any time.
Can You Day Trade Penny Stocks on Robinhood?
Day trading on Robinhood is like pulling onto the highway with two flat tires. You can do it, and it’ll work, but it won’t be pretty. Serious traders tend to use more robust software. Research different brokerages and software to find what might work best for you.
What’s the Catch With Robinhood?
Robinhood has a sleek app, zero commissions, and you can even get a free stock for opening an account. How can that be profitable? They make money by charging what’s known as ‘payment for order flow.’ Market makers and trading firms pay Robinhood for the ability to take the other side of your trades. They make tiny profits on each transaction, which add up over time. And no, they aren’t the only broker to do that.
Robinhood Penny Stocks to Watch: Conclusion
There you have it — my top 10 Robinhood penny stocks to watch in July 2021.
As you can see, Robinhood has some pros and cons just like any other broker or platform. It’s up to you to find your strategy, then find a broker and platform that fits your needs.
If you want to try a more advanced platform, check out StocksToTrade. It’s a platform built by traders for traders and it has a TON of tools and resources that will make even the most experienced traders happy.
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Have you used Robinhood to trade penny stocks? I’d love to hear about your experience. Leave a comment below!