Stock Screener


Stocks Under $5

Best Stocks under $5 is a list of trending stocks under $5 and above $4. These stocks are traded on NYSE, NASDAQ, and AMEX and sorted by percentage gain of the day so traders can easily see the top stocks under 5 for today. To filter stocks by any price and volume, please use our free technical stock scanner.

Best Stocks Under 5

The top stocks under $5 list is updated daily after the market closes. Please check back for the newest low-price stocks.

1/27/2023

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Symbol Chart Open High Low Close Volume % Change Stock Predictions
VRAR 3.31 4.30 3.31 4.04 271500 19.17% VRAR Stock Predictions
INOD 3.45 4.07 3.45 4.06 105800 17.00% INOD Stock Predictions
SFIX 4.38 4.98 4.33 4.94 2980700 11.76% SFIX Stock Predictions
LRMR 4.25 4.78 4.25 4.67 58800 11.19% LRMR Stock Predictions
APCX 4.52 5.23 4.45 4.90 319700 10.86% APCX Stock Predictions
WW 4.40 4.97 4.38 4.93 2050000 10.54% WW Stock Predictions
EMBK 3.90 4.42 3.90 4.35 342700 10.41% EMBK Stock Predictions
SWIM 3.77 4.18 3.71 4.15 344800 9.50% SWIM Stock Predictions
IKNA 4.38 4.56 4.16 4.48 19800 9.27% IKNA Stock Predictions
GOTU 3.77 4.10 3.59 4.07 5326300 8.53% GOTU Stock Predictions
ALLG 4.13 4.49 4.04 4.42 102000 8.07% ALLG Stock Predictions
THRN 4.13 4.54 4.09 4.47 79000 7.71% THRN Stock Predictions
BIOR 4.40 4.87 4.36 4.77 651600 7.67% BIOR Stock Predictions
MAIA 4.49 4.57 4.32 4.49 16700 7.42% MAIA Stock Predictions
GLT 4.12 4.44 4.07 4.35 648800 7.41% GLT Stock Predictions
FNGG 3.77 4.25 3.74 4.07 203000 7.11% FNGG Stock Predictions
AMWL 3.77 4.05 3.76 4.02 796300 6.91% AMWL Stock Predictions
NPCE 3.96 4.30 3.89 4.09 24800 6.79% NPCE Stock Predictions
BTMD 4.00 4.16 3.83 4.16 35200 6.67% BTMD Stock Predictions
HOWL 3.85 4.14 3.77 4.10 169000 6.49% HOWL Stock Predictions
RENT 3.89 4.25 3.83 4.15 1176600 6.41% RENT Stock Predictions
MYNA 4.22 4.47 4.22 4.35 3600 6.36% MYNA Stock Predictions
HTOO 3.80 4.15 3.80 4.04 118300 6.32% HTOO Stock Predictions
ILPT 3.96 4.23 3.96 4.19 525700 5.81% ILPT Stock Predictions
PRAX 4.48 4.81 4.48 4.76 558500 5.54% PRAX Stock Predictions
GRWG 4.35 4.72 4.31 4.64 1292300 5.45% GRWG Stock Predictions
JMIA 3.99 4.41 3.97 4.28 2910400 5.42% JMIA Stock Predictions
CMAX 4.11 4.43 4.06 4.33 138800 5.35% CMAX Stock Predictions
EYPT 4.48 4.76 4.44 4.73 98300 5.35% EYPT Stock Predictions
JOBY 4.11 4.44 4.09 4.34 4291000 5.34% JOBY Stock Predictions
CYH 4.61 5.01 4.50 4.92 3245900 5.13% CYH Stock Predictions
VTEX 4.31 4.72 4.24 4.53 373800 5.10% VTEX Stock Predictions
NXE 4.57 4.92 4.57 4.84 2698300 4.99% NXE Stock Predictions
ACHV 4.68 5.15 4.68 4.94 70800 4.88% ACHV Stock Predictions
AZRE 4.05 4.47 4.05 4.35 212300 4.82% AZRE Stock Predictions
QUOT 3.80 4.05 3.73 4.00 367800 4.71% QUOT Stock Predictions
PGRU 4.43 4.55 4.43 4.47 2600 4.44% PGRU Stock Predictions
SLNG 4.63 4.74 4.62 4.70 8700 4.44% SLNG Stock Predictions
SANA 4.63 4.92 4.55 4.81 1164300 4.34% SANA Stock Predictions
GNFT 4.16 4.36 4.16 4.36 4900 4.31% GNFT Stock Predictions
CRPT 4.48 4.70 4.48 4.63 13800 4.28% CRPT Stock Predictions
JAGX 4.47 4.77 4.45 4.70 309300 4.21% JAGX Stock Predictions
SSU 5.00 5.11 4.55 5.00 34100 4.17% SSU Stock Predictions
TRT 4.70 5.02 4.70 5.00 22800 4.17% TRT Stock Predictions
TK 4.58 4.82 4.58 4.75 1307300 3.94% TK Stock Predictions
UBX 4.35 4.53 4.31 4.48 181500 3.94% UBX Stock Predictions
IPDN 4.80 4.81 4.56 4.80 56500 3.90% IPDN Stock Predictions
CRMD 4.11 4.43 4.11 4.31 240300 3.86% CRMD Stock Predictions
ELSE 4.74 4.87 4.69 4.87 7900 3.84% ELSE Stock Predictions
SLI 3.87 4.11 3.86 4.10 692000 3.80% SLI Stock Predictions
XLO 4.00 4.34 3.95 4.28 113200 3.63% XLO Stock Predictions
DAPP 4.43 4.62 4.39 4.60 91800 3.60% DAPP Stock Predictions
BB 4.19 4.41 4.19 4.37 6436100 3.55% BB Stock Predictions
LASE 4.61 5.06 4.51 4.80 532000 3.45% LASE Stock Predictions
ERAS 3.90 4.11 3.90 4.04 1001900 3.32% ERAS Stock Predictions
NU 4.20 4.42 4.18 4.37 26047900 3.31% NU Stock Predictions
ATHA 3.97 4.14 3.93 4.11 263800 3.27% ATHA Stock Predictions
TUP 3.99 4.21 3.97 4.12 516600 3.26% TUP Stock Predictions
SNES 3.91 4.14 3.91 4.04 4400 3.06% SNES Stock Predictions
UEC 3.96 4.18 3.93 4.07 11188500 3.04% UEC Stock Predictions
ENLV 4.39 4.44 4.26 4.42 4900 3.03% ENLV Stock Predictions
VCLO 4.83 4.87 4.74 4.87 6100 2.96% VCLO Stock Predictions
LTBR 4.12 4.38 4.12 4.26 81400 2.90% LTBR Stock Predictions
AMTX 4.15 4.31 4.15 4.31 231600 2.86% AMTX Stock Predictions
BLDE 4.34 4.62 4.32 4.51 284100 2.73% BLDE Stock Predictions
SST 4.78 4.98 4.65 4.91 29700 2.72% SST Stock Predictions
INLX 4.22 4.35 4.16 4.35 23200 2.59% INLX Stock Predictions
NHTC 4.60 4.87 4.58 4.76 59100 2.59% NHTC Stock Predictions
FCRD 4.56 4.65 4.53 4.65 143100 2.42% FCRD Stock Predictions
DSP 4.60 4.79 4.55 4.67 171100 2.41% DSP Stock Predictions
BRMK 4.31 4.47 4.31 4.42 931900 2.31% BRMK Stock Predictions
HFFG 4.17 4.19 4.01 4.15 16400 2.22% HFFG Stock Predictions
XIN 4.58 4.71 4.55 4.65 15300 2.20% XIN Stock Predictions
BRLT 4.51 4.79 4.51 4.66 105200 2.19% BRLT Stock Predictions
ATUS 4.72 4.88 4.65 4.85 2304500 2.11% ATUS Stock Predictions
MNTX 3.99 4.05 3.97 4.02 35500 2.03% MNTX Stock Predictions
PULM 4.00 4.11 4.00 4.07 23100 2.01% PULM Stock Predictions
BEAT 4.10 4.18 4.03 4.16 35000 1.96% BEAT Stock Predictions
SYRS 4.44 4.59 4.37 4.50 89600 1.81% SYRS Stock Predictions
UWMC 4.47 4.57 4.45 4.55 751200 1.79% UWMC Stock Predictions
WHLM 4.27 4.65 4.15 4.58 8500 1.78% WHLM Stock Predictions
IPSC 4.53 4.73 4.53 4.63 99900 1.76% IPSC Stock Predictions
HTGM 4.12 4.30 4.11 4.24 153300 1.68% HTGM Stock Predictions
GHG 4.31 4.79 4.31 4.47 48700 1.59% GHG Stock Predictions
IBRX 3.90 4.09 3.90 4.01 1023700 1.52% IBRX Stock Predictions
GGR 4.61 4.75 4.61 4.70 182500 1.51% GGR Stock Predictions
CSBR 4.10 4.16 4.05 4.11 7900 1.48% CSBR Stock Predictions
FARM 4.81 4.89 4.80 4.87 20600 1.46% FARM Stock Predictions
MCG 4.74 4.94 4.74 4.85 202300 1.46% MCG Stock Predictions
EGHT 4.81 4.94 4.74 4.92 1124200 1.44% EGHT Stock Predictions
CNSL 4.25 4.38 4.15 4.34 213000 1.40% CNSL Stock Predictions
MJ 4.39 4.54 4.36 4.46 1323700 1.36% MJ Stock Predictions
PCTI 4.65 4.79 4.65 4.67 9900 1.30% PCTI Stock Predictions
RKLB 4.86 5.04 4.81 4.94 3658800 1.23% RKLB Stock Predictions
TLS 4.90 5.05 4.86 5.00 480600 1.21% TLS Stock Predictions
RSI 4.10 4.28 4.06 4.20 241500 1.20% RSI Stock Predictions
AWP 4.37 4.44 4.35 4.43 376800 1.14% AWP Stock Predictions
ANIX 4.31 4.62 4.31 4.46 44500 1.13% ANIX Stock Predictions
AZYO 4.42 4.81 4.42 4.46 56500 1.13% AZYO Stock Predictions
TLF 4.50 4.50 4.38 4.47 1500 1.13% TLF Stock Predictions
TSI 4.84 4.93 4.84 4.91 58200 1.03% TSI Stock Predictions
AGIL 4.18 4.20 4.16 4.20 17300 0.96% AGIL Stock Predictions
CAPR 4.12 4.37 4.00 4.24 207100 0.95% CAPR Stock Predictions
IMRX 4.39 4.70 4.31 4.45 33400 0.91% IMRX Stock Predictions
NBTX 4.49 4.49 4.49 4.49 600 0.90% NBTX Stock Predictions
LTRX 4.70 4.80 4.67 4.70 207000 0.86% LTRX Stock Predictions
IMGN 4.72 4.87 4.70 4.75 1684500 0.85% IMGN Stock Predictions
DRTS 4.00 4.13 3.90 4.03 39200 0.75% DRTS Stock Predictions
CUBA 4.01 4.11 4.01 4.10 17100 0.74% CUBA Stock Predictions
SSSS 4.10 4.17 4.08 4.16 105800 0.73% SSSS Stock Predictions
LGL 4.43 4.47 4.40 4.40 5500 0.69% LGL Stock Predictions
IPA 4.41 4.50 4.41 4.44 11100 0.68% IPA Stock Predictions
AVPT 4.46 4.54 4.40 4.52 349300 0.67% AVPT Stock Predictions
CAMP 4.46 4.57 4.41 4.53 189000 0.67% CAMP Stock Predictions
AVIR 4.55 4.64 4.53 4.60 292500 0.66% AVIR Stock Predictions
MFV 4.57 4.62 4.53 4.57 22600 0.66% MFV Stock Predictions
OB 4.93 5.04 4.89 4.96 117400 0.61% OB Stock Predictions
NMR 4.06 4.07 4.04 4.05 484100 0.50% NMR Stock Predictions
CANF 4.12 4.22 4.00 4.07 48700 0.49% CANF Stock Predictions
JRSH 4.24 4.25 4.19 4.25 4800 0.47% JRSH Stock Predictions
PBI 4.25 4.29 4.18 4.27 736400 0.47% PBI Stock Predictions
THRD 4.14 4.34 4.14 4.27 86700 0.47% THRD Stock Predictions
LSAK 4.17 4.38 4.17 4.37 19400 0.46% LSAK Stock Predictions
GIM 4.42 4.50 4.42 4.46 129500 0.45% GIM Stock Predictions
VIRC 4.80 4.86 4.78 4.84 8900 0.41% VIRC Stock Predictions
PROC 6.70 6.70 4.20 4.31 17900 0.23% PROC Stock Predictions
ELTK 4.47 4.52 4.47 4.51 2800 0.22% ELTK Stock Predictions
EOD 4.75 4.77 4.71 4.75 55000 0.21% EOD Stock Predictions
MOR 4.93 4.98 4.90 4.94 71900 0.20% MOR Stock Predictions
EDD 4.69 4.71 4.65 4.68 171400 0.00% EDD Stock Predictions
FSCO 4.96 5.10 4.83 5.00 317000 0.00% FSCO Stock Predictions
GIFI 5.06 5.06 4.92 5.00 18400 0.00% GIFI Stock Predictions
MICS 4.65 4.65 4.46 4.49 2800 0.00% MICS Stock Predictions
MMT 4.86 4.89 4.85 4.86 105800 0.00% MMT Stock Predictions
VRAY 4.52 4.61 4.47 4.52 554200 0.00% VRAY Stock Predictions
CARV 4.95 4.95 4.75 4.91 6900 -0.20% CARV Stock Predictions
TTSH 4.93 5.01 4.92 4.96 54100 -0.20% TTSH Stock Predictions
NSL 4.86 4.88 4.83 4.85 130200 -0.21% NSL Stock Predictions
PRTH 4.50 4.59 4.10 4.47 24600 -0.22% PRTH Stock Predictions
ICU 4.29 4.57 4.25 4.30 38100 -0.23% ICU Stock Predictions
ZVIA 4.44 4.54 4.37 4.43 57500 -0.23% ZVIA Stock Predictions
CGA 4.09 4.19 4.05 4.13 7100 -0.24% CGA Stock Predictions
TIGR 4.19 4.25 4.13 4.20 717200 -0.24% TIGR Stock Predictions
USAU 4.92 5.05 4.85 4.90 8100 -0.41% USAU Stock Predictions
GEOS 4.79 4.79 4.75 4.76 7500 -0.42% GEOS Stock Predictions
ALPS 4.50 4.50 4.48 4.48 2500 -0.44% ALPS Stock Predictions
HIO 4.05 4.09 4.05 4.06 179500 -0.49% HIO Stock Predictions
OPHC 4.26 4.26 4.10 4.10 2600 -0.49% OPHC Stock Predictions
PL 4.87 4.92 4.79 4.83 991200 -0.62% PL Stock Predictions
VTSI 4.84 4.85 4.80 4.80 10700 -0.62% VTSI Stock Predictions
FREQ 4.78 4.80 4.65 4.75 187800 -0.63% FREQ Stock Predictions
OLMA 4.68 4.99 4.46 4.71 106000 -0.63% OLMA Stock Predictions
MYPS 4.60 4.67 4.53 4.59 308700 -0.65% MYPS Stock Predictions
AVTX 3.95 4.16 3.90 4.00 10700 -0.74% AVTX Stock Predictions
TOP 4.92 5.00 4.89 4.90 10400 -0.81% TOP Stock Predictions
OIIM 4.66 4.70 4.60 4.64 36700 -0.85% OIIM Stock Predictions
QUAD 4.47 4.49 4.41 4.44 59100 -0.89% QUAD Stock Predictions
VMAR 4.75 4.84 4.31 4.38 22700 -0.90% VMAR Stock Predictions
BGCP 4.35 4.44 4.30 4.35 1438600 -0.91% BGCP Stock Predictions
CHCI 4.21 4.23 4.15 4.16 6900 -0.95% CHCI Stock Predictions
API 4.14 4.32 3.99 4.12 460300 -0.96% API Stock Predictions
NDRA 3.98 4.26 3.95 4.01 4700 -0.99% NDRA Stock Predictions
RMNI 4.92 5.03 4.88 4.91 232800 -1.01% RMNI Stock Predictions
WIT 4.89 4.92 4.87 4.90 1837100 -1.01% WIT Stock Predictions
GSM 4.72 4.83 4.69 4.73 549000 -1.05% GSM Stock Predictions
VRCA 4.76 4.85 4.63 4.71 70000 -1.05% VRCA Stock Predictions
IONQ 4.48 4.57 4.43 4.49 4091700 -1.10% IONQ Stock Predictions
RVPH 4.48 4.50 4.27 4.36 71500 -1.13% RVPH Stock Predictions
VSTA 4.28 4.35 4.21 4.29 31200 -1.15% VSTA Stock Predictions
SRT 4.11 4.19 4.11 4.15 11000 -1.19% SRT Stock Predictions
KGC 4.81 4.82 4.72 4.79 10817900 -1.24% KGC Stock Predictions
XBIT 4.55 4.55 4.37 4.44 14700 -1.33% XBIT Stock Predictions
VMEO 4.42 4.46 4.32 4.39 1330800 -1.35% VMEO Stock Predictions
ACTG 4.37 4.43 4.32 4.33 122000 -1.37% ACTG Stock Predictions
CTLP 5.00 5.08 4.88 4.99 209600 -1.38% CTLP Stock Predictions
CURO 4.18 4.26 4.07 4.14 26200 -1.43% CURO Stock Predictions
APT 4.10 4.17 4.05 4.08 61500 -1.45% APT Stock Predictions
PTN 4.06 4.24 3.85 4.02 75700 -1.47% PTN Stock Predictions
COYA 4.51 4.59 4.26 4.54 12600 -1.52% COYA Stock Predictions
NMG 5.15 5.15 4.92 4.97 40300 -1.58% NMG Stock Predictions
HIBS 4.97 4.97 4.68 4.79 2813700 -1.64% HIBS Stock Predictions
NOK 4.77 4.79 4.73 4.73 18576500 -1.66% NOK Stock Predictions
RLMD 4.24 4.37 4.10 4.12 144100 -1.67% RLMD Stock Predictions
DOUG 4.72 4.75 4.64 4.64 219600 -1.69% DOUG Stock Predictions
BTG 4.11 4.13 4.03 4.03 7986200 -1.71% BTG Stock Predictions
CNDT 4.82 4.83 4.69 4.74 758000 -1.86% CNDT Stock Predictions
DTC 4.22 4.35 4.13 4.22 259800 -1.86% DTC Stock Predictions
ELOX 4.24 4.25 4.08 4.18 11900 -1.88% ELOX Stock Predictions
PXS 4.76 5.00 4.64 4.71 63500 -1.88% PXS Stock Predictions
OCC 4.02 4.02 4.02 4.02 200 -1.95% OCC Stock Predictions
OMQS 5.02 6.00 4.66 4.95 108500 -1.98% OMQS Stock Predictions
SANG 4.35 4.62 4.21 4.26 81200 -2.07% SANG Stock Predictions
OABI 4.46 4.60 4.30 4.36 353400 -2.24% OABI Stock Predictions
TESS 4.68 4.93 4.68 4.79 25600 -2.24% TESS Stock Predictions
YMAB 4.05 4.50 4.05 4.44 331300 -2.42% YMAB Stock Predictions
ORLA 4.07 4.09 3.98 4.02 199500 -2.43% ORLA Stock Predictions
HOTH 5.00 5.18 4.78 4.80 116500 -2.44% HOTH Stock Predictions
SKYH 4.75 5.03 4.67 4.97 9800 -2.55% SKYH Stock Predictions
DAIO 4.17 4.20 4.03 4.06 1500 -2.64% DAIO Stock Predictions
PW 4.55 4.71 4.36 4.43 8800 -2.64% PW Stock Predictions
ASRT 4.14 4.20 3.98 4.01 1114900 -2.67% ASRT Stock Predictions
BNOX 4.50 5.33 4.02 4.28 40400 -2.73% BNOX Stock Predictions
FSTX 4.16 4.32 3.81 4.21 1107100 -2.77% FSTX Stock Predictions
KTCC 4.66 4.72 4.56 4.57 62100 -2.77% KTCC Stock Predictions
TGAN 4.93 5.17 4.84 4.86 20600 -2.80% TGAN Stock Predictions
UVXY 5.02 5.02 4.73 4.86 40540500 -2.80% UVXY Stock Predictions
ITUB 4.90 4.93 4.83 4.85 23190000 -2.81% ITUB Stock Predictions
ACGN 4.82 4.91 4.55 4.71 20500 -2.89% ACGN Stock Predictions
NR 4.33 4.37 4.21 4.24 1014600 -2.97% NR Stock Predictions
ERNA 4.83 4.97 4.82 4.84 5200 -3.01% ERNA Stock Predictions
KMDA 4.50 4.61 4.40 4.45 25200 -3.05% KMDA Stock Predictions
BBAR 4.78 4.83 4.61 4.63 551200 -3.54% BBAR Stock Predictions
WVE 4.47 4.57 4.29 4.31 264300 -3.58% WVE Stock Predictions
ICD 4.93 4.94 4.68 4.74 69300 -3.66% ICD Stock Predictions
IMRA 4.24 4.40 3.95 4.09 71600 -3.76% IMRA Stock Predictions
GIPR 5.05 5.10 4.80 4.89 29000 -3.93% GIPR Stock Predictions
PBYI 4.39 4.51 4.22 4.24 234600 -4.07% PBYI Stock Predictions
EGY 4.96 5.00 4.74 4.75 1185700 -4.23% EGY Stock Predictions
GANX 4.22 4.22 4.01 4.07 40500 -4.24% GANX Stock Predictions
LGVN 4.44 4.58 4.13 4.16 98400 -4.59% LGVN Stock Predictions
EQX 4.77 4.77 4.52 4.55 2038100 -4.61% EQX Stock Predictions
JFU 4.83 4.83 4.35 4.50 44000 -4.86% JFU Stock Predictions
CCEL 4.72 4.72 4.00 4.03 37800 -6.93% CCEL Stock Predictions
CDZI 4.42 4.47 3.99 4.09 112900 -7.67% CDZI Stock Predictions
ZFOX 4.21 4.56 4.04 4.16 73100 -8.97% ZFOX Stock Predictions

How to trade stocks under $5?

There are various ways to trade stocks under $5, such as the breakout trading strategy and the pullback strategy that we will be discussing below.

To make money from trading, we will be utilizing technical analysis and stock chart patterns to swing trade in the stock market. If you are new to trading, you may want to read the following articles.
How to Read a Stock Chart Top 10 Stock Chart Patterns Introducing Technical Analysis
The tools that we will be using are stock charts and the strategies are as follows. Oftentimes, when a stock makes a massive move and then falls over 60-80%, there is a possibility that the stock may make smaller bounces before falling again.

The trick is to buy into one of these stocks before the second bounce. Especially, here's the trading strategy that we will be using.


Trading Strategy

We've already discussed this low cap strategy in detail in the article Penny Stocks Trading Strategy. In summary, here's what the trading strategy does.

  • Low Price - We will look for stocks trading in the range of $0.8 to $5 on NASDAQ, NYSE, or AMEX. We are not interested in stocks trading on the OTCBB market.
  • Big Rally - The stock must be up at least 80% recently, with a single spike of 30% or more in 1 day. The trading volume must be huge compared to the average trading volume of the stock.
  • Plunge - The stock then falls over 40% from its peak close or 65% from the intraday high with low trading volume.


Here are three recent stock patterns that matched the criteria. All three stocks were taken from November 4, 2020.

If we look at the stock charts of the above stocks which met all of our trading criteria, the big rise, and fall, we see that all the stocks made decent moves after that pattern occurred.

Our goal is not to make money from the initial big rise, but to make money after the big fall because there is no pattern that I can find that predicts the first rise.


Stop Loss

Please note that not all stocks are going to perform that well and bounce in a week or two. Most of the time, the stocks either don't move or may even drop further.

During those times, we must cut our losses short and move on to the next trade. The reason most stock market beginners lose money in the stock market is that they never cut losses short. They always allow the losses to pile up and cut their profits too quickly.

The pattern that we showed above doesn't work all the time. In fact, it doesn't work at all when the general market is down. Therefore, we must protect ourselves with tight stop losses. That way, when we lose, we lose small. When we win, we win big.




Profit Target

Just like a stop loss, we also need a profit target. Without a proper profit-taking strategy, you may give up most of your gains back to the market. Here are a few strategies that you may test and see which one works the best for you, or you can come up with your own profit-taking strategy.

In general, you want to have a target price that gives you at least a 1:2 risk-reward ratio, meaning if you are risking $1 on a trade, your trade should have the potential to make $2.

  • Target price - you can set a target price at the next resistance level assuming the target price gives you the proper risk-reward ratio.
  • Percent - you can set a percentage gain target. For example, if your stop loss is 10%, your profit target might be 20%.
  • Let your profit run - you can have your whole position on and let the profits run until the stock pulls back. The problem with this strategy is that you could give up most of your gains.
  • Exit partially - you can have multiple target prices. As soon as the stock hits your first profit target, sell half your position. When the stock hits your next profit target level, exit the rest of the position. To protect your profit, you should move up the stop loss from your initial entry point as the stock goes higher.

Position Size

Position size is always important in any trade. Many beginners have a position size that is too large that could wipe them out in one bad trade.

Remember, no matter how good a pattern looks or how good a trade setup appears to be, there is still a chance that it may fail. If we lose a lot of money on one trade, not only would it crush our confidence in trading, but it would also ruin our account.

Therefore, the goal of trading is not to make a lot of money on any one trade and get rich quickly. The goal is to get rich slowly making thousands of trades in the long term.

The position size of any trade should be less than 10% of your account size, preferably 5%. On top of that, you should have stop loss with any trade you enter, so that you will be risking less than 2% on any trade relative to the size of your portfolio.


Market Direction

When the market is bullish, you will see a lot of stocks making big moves, and your trades are working out nicely.

On the other hand, when the market is bearish, you may not find any stocks to trade or the trades just don't work. In that case, you should stay out of the market. It could be a few days, a few weeks, or even several months.

Most of us have no way to predict the market direction, but we do know whether we are winning or losing.

The goal of trading is to make money, if you are starting to lose money, there is no point to be in the market.

However, many beginners do the exact opposite. When they lose money, they start to increase their position size trying to make the money that they just lost. This is called revenge trading, and it is very dangerous.

When traders start to trade with their emotions instead of logic, they are on their way to donating their money to the market.




Trading Psychology

Psychology is critical for trading success, yet is ignored by most beginner traders. To me, trading psychology is more important than any strategy.

You may have a trading strategy that works 80% of the time but without the mental discipline to keep yourself from losing most of your money on the other 20%, you will still end up a loser.

A sound trading strategy without knowing anything about trading psychology is not enough to be the market. One may have the best strategy in the world, but if he fails to execute trades at the right time is going to lose money.

When we look at the stock charts and technical analysis without investing any money, we all can think logically.

However, as soon as we have our money loaded on the stocks, we act differently. All of our thinking may be based on how much we would make or lose on a trade instead of focusing on the pattern itself.

We should treat the stock market calmly and if we are confident with our trading decisions and system, we will make money. On the other hand, if our decisions are based on fear and greed, we will lose money.


Learn From Your Mistake

It's important to learn from your own mistakes or the mistakes of others. Then come up with a set of rules that you should follow for every trade.

You can modify your rules as you gain more experience. However, don't change your rule while you are already in a trade.

For example, if you have a rule that says you must cut your loss at 10% for all trades. And you already have a stock that is going against you with a 10% loss. You cannot move your stop loss lower in order to stay in the trade, you must cut the loss and move on.

If you find a 10% loss is not the optimal stop loss for your trading strategy, you can modify your rule to set the stop loss at 8% or even 12%. But you can only do that after a trade is over, and the rules that you set should be based on your experience.


Keep a Trading Journal

Most successful traders keep a trading journal that tracks all of their trades. A trading journal allows them to go back and study their past trades and find the flaws in their trading system.

Tracking and improving are necessary for traders to stay in this game for the long run. You don't see beginners do that because they are always trying to find a magic stock that would make them rich. Unfortunately, the stock market is not a place where you can make quick money.

Keep a trading journal if you are serious about trading and making money from the market. If you can find a few mistakes in your trading system and improve it, it could translate into cash.

Treat trading as a business, not a hobby. A trading journal should track at least the following.

  • The entry price
  • Position size - record how many shares you buy and how much you are trading with.
  • The reason for entry
  • The strategy - If you have multiple trading strategies, you should log the strategy that you are using.
  • The entry stock charts - you can attach the weekly, daily, or intraday chart depending on the time frame that you trade with
  • The market sentiment - you can log the Dow and NASDAQ, this gives you an idea of whether the market is bullish or bearish when you enter the trade. When the general market is in panic, it is hard to make money going long.
  • The exit price
  • The reason for exit
  • The exit stock charts - you should include the charts when you exit the trade.
  • The market sentiment - is the Dow and NASDAQ up or down when you exit the trade?
  • The profit/loss - how much did you make or lose on this trade in terms of percentage.

You can add or remove items from this list to fit your own trading style.




What stock can I buy for $5?

There are many stocks under $5 that are worth watching for traders with a small account. Let's face it, one share of Amazon stock costs over $3,000. If you have only $2,000 to invest, you cannot even purchase one share of Amazon stock.

That is not to say Amazon stock is not a good stock, or you shouldn't be buying high-priced stocks. In fact, it's the exact opposite. Expensive stocks are trading at high prices for a good reason, they are usually better, safer, and have more potential to grow over the long term.

These companies usually have stronger fundamentals, product lines that are not easily replicated by others, a great leadership team, and loyal fans of their products. All of these mean the company is making tons of money with excellent income statements and balance sheets.

However, for small traders with limited funds, you may consider stocks that are trading under $5. Some of these stocks may go up much faster than the blue-chip stocks. It is much harder for stocks trading at $100 to double up to $200, but a $5 stock may go up to $10 in a much shorter period of time.

Of course, buying stocks under $5 is much riskier, because companies with a stock price of $5 or lower generally don't do well at the moment. The odds of these low-price stocks going bankrupt in the long term are much higher than the possibility of doubling up.

For this reason, we are not interested in investing in these low-price stocks, these are stocks to be traded for the short term. If we buy any of the stocks, we usually sell them in a short time frame, anywhere from a couple of days to a few weeks maximum.


How to Find Hot Stocks Under $5

You can use our free stock screener to scan for hot stocks under $5. Our stock screener gives you the option to scan for popular technical indicators and find stocks that match these patterns.

Some of the technical indicators that you scan for are price and volume actions, moving averages, candlestick patterns, stochastic oscillators, RSI, MACD, and many more.

You can read the following article on how to use our stock screener and find stocks for swing trading.

How to Find Stocks For Swing Trading



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