Best Penny Stocks to Watch in May 2025, Using Technical Analysis

These are some of the penny stocks with interesting charts that performed well over the past month

Once a stock price is below $5 per share, it is categorized as a penny stock. Frequently, but not always, penny stocks have small market capitalizations and are prone to high volatility due to low liquidity and trading volumes. Penny stocks can, therefore, provide an opportunity for large, quick gains because a small movement in the price of a penny stock can produce a large percentage gain. But they also carry significant risks compared to more established stocks. To guard against the risks associated with investing in penny stocks, the stocks discussed in this article have a minimum price and volume, along with clear chart patterns and other technical analysis indicators.

Below is an analysis of developing bullish patterns in penny stocks for May 2025, pulled from a screen showing positive one-month performance, a minimum price of $1.50, and a 30-day average daily volume of at least 200,000 shares.

All charts and data are current as of April 28, 2025.

Key Takeaways

• Penny stocks typically trade for less than $5 per share.
• Penny stocks are considered high-risk investments with high volatility due to their speculative nature, low liquidity, and low trading volumes.
• Investors should look for penny stocks with minimum price and volume criteria to mitigate potential risks.
• Penny stocks often trade over-the-counter, which means they have minimal regulatory oversight, and it may be difficult to access company information.
• However, the penny stocks in this article are listed on the New York Stock Exchange or Nasdaq, so they are subject to the same listing requirements as any other company on these exchanges.

AmpliTech Group, Inc. (AMPG)

• Price: $1.74
• One-month return: 15.2%
• Average daily trading volume: 319,000
• Exchange: Nasdaq

A falling bull wedge breakout triggered in the stock of AmpliTech Group (AMPG) during the month of April. The company designs and manufactures advanced radio frequency and microwave components in telecom, satellite, defense, and quantum computing markets. Last week, the stock confirmed the breakout with a strong closing price near the highs of the range. The formation of the bull wedge follows a period of high volatility that began with a 724% price rise in six weeks, while most of the change happened in only three weeks. That spike following the Nov. 18 interim swing low showed aggressive buying, while the wedge breakout indicates that buyers are back in charge, which could lead to a second breakout above the 200-week moving average. The 200-week line was reclaimed in late December, but the company’s stock subsequently failed to sustain itself above that line. This next attempt may have greater success if strength is sustained.

BRF S.A. (BRFS)

• Price: $3.97
• One-month return: 16.4%
• Average daily trading volume: 2.5 million
• Exchange: New York Stock Exchange

There were renewed signs of strength for the stock of BRF S.A. (BRFS) recently. The company is one
of the world’s largest food companies, specializing in the production and global distribution of fresh and frozen protein foods. In March, the company’s stock completed a 50% retracement and successful test of the 200-week moving average as support and established a higher swing low of $2.99. The pullback was the first test of the 200-week line since it was reclaimed on March 4. Moreover, a long-term downtrend line was also in the vicinity of the $2.99 swing low. Subsequently, the stock rebounded and reclaimed the 20-week moving average and is attempting to sustain a breakout above the 50-week moving average this week.

The price of BRFS stock declined by as much as 38.6% during the recent bearish correction. It’s the largest decline since the uptrend, and it established a higher swing high and a new trend support line and top channel line. If the uptrend continues to progress, the first confluence zone and therefore a potential target lies around $5.38 to $5.51. That zone consists of the 127.2% extension of the recent decline and 50% retracement level, respectively.

Microvast Holdings, Inc. (MVST)

• Price: $2.09
• One-month return: 81.7%
• Average daily trading volume: 10.1 million
• Exchange: Nasdaq

Microvast Holdings, Inc. (MVST) develops and manufactures advanced battery solutions for electric vehicles and energy storage systems worldwide. Its stock broke out of a bull flag trend continuation pattern last week following a test of support at the 20-week moving average. The flag breakout was accompanied by an inside week breakout and a small pennant on the daily time frame. Although there is potentially significant resistance around the recent trend high of $2.87, the bull flag breakout shows buyers in charge and improving bullish momentum. That high area was previously resistance in July 2023, and the 200-week moving average is about to converge with that price, as it is currently at $2.88 and falling. Therefore, a decisive rally above $2.87 triggers a continuation of the flag breakout, while an advance above $2.91 triggers a long-term bullish trend reversal as a lower swing high will be reversed, and a rise above the 200-day line further confirms a reversal. Prior to the flag formation, MVST’s stock climbed over 1,700% in only six weeks. If the integrity of the bull flag breakout is sustained, it indicates that similar strong demand could return to the stock.

Protalix BioTherapeutics (PLX)

• Price: $2.85
• One-month return: 10.5%
• Average daily trading volume: 719,000
• Exchange: NYSE

Protalix BioTherapeutics (PLX) is a biopharmaceutical company developing and commercializing recombinant therapeutic proteins focusing on treatments for rare diseases. The company’s stock broke out of a bull pennant last week and confirmed strength by closing above the prior trend high of $2.76. An estimated measuring objective from the pattern on a percentage basis, that considers the 134% advance (pole) prior to the pennant forming, is $6.25. PLX has been showing evidence of a possible bullish reversal of the long-term downtrend since the 200-day moving average was reclaimed in November. It was followed by a breakout above a long-term downtrend line for the first time. Strength was retained following the breakouts as the pennant consolidation formed above the trendline with an exact test of the line as support. Furthermore, the pennant successfully tested the 20-day moving average line as support, and it was followed by the pennant breakout a couple of days after.

Standard Lithium Ltd. (SLI)

• Price: $1.49
• One-month return: 15.5%
• Average daily trading volume: 2.2 million
• Exchange: NYSE

The stock of Standard Lithium Ltd. (SLI) tested support around recent lows for the third time
recently before it reversed higher, leading to a rally and huge volume spike last week (500% above the weekly average). This behavior identifies a potential bottom for the stock of the company, which develops and operates large-scale lithium brine projects in the U.S. Both the 20-week and 50-week moving averages were reclaimed following the third bottom, with strength confirmed by a weekly
close above both lines.

A bull breakout of the long-term downtrend line was attempted last October but failed. Nonetheless, the next breakout attempt may have greater success and might be the start of a long-term bullish reversal in the stock of SLI. Further signs of strength would then be needed, however, to estimate that the stock had a chance to advance above the most recent lower swing high of $2.64. Based on the price structure of the trend, that high would need to be exceeded before a clear long-term bullish trend reversal is indicated. 

What to Know About Penny Stocks

Many penny stocks trade via over-the-counter (OTC) markets, which means they have minimal regulatory oversight and little analyst coverage, making it difficult to access accurate company information.

However, the penny stocks we’ve identified in this article are all listed on the New York Stock Exchange or Nasdaq, which means they are subject to the same listing requirements as any other company on these exchanges. These requirements are intended to ensure that only high-quality securities are available for trading on the exchange.

While penny stocks are a riskier investment than established stocks due to their volatility, the potential for high returns is attractive to some investors.

How We Chose the Best Penny Stocks

To screen for penny stocks with interesting chart patterns and other technical analysis indicators, we used the following criteria. Stocks had to have positive one-month performance and be priced under $5.00. To help improve the reliability of the chart patterns, the stocks had to have a minimum price of $1.50 and an average 30-day trading volume of at least 200,000. The stock also had to have at least 24 months of trading history.

The charts were also reviewed for bullish patterns, including breakouts above trendlines, key resistance, and moving averages. Candlestick patterns were also considered, as we looked for signs that pointed to a bullish trend reversal or indications that a trend was strengthening. Still, it’s important to remember that past performance is not a guarantee of future performance.

Penny Stock Advantages and Disadvantages

The low price of penny stocks offers investors high potential for growth, and they can give smaller businesses a platform to access funding. But while these stocks can bring investors significant gains, they also carry the risk of significant losses. There are greater risks associated with investing in penny stocks than with more established stocks.

Penny stocks usually lack liquidity. It can also be difficult to find solid public information about penny stock companies that trade over the counter. Given the additional risks, penny stocks are not suitable for all investors, especially those with a low risk tolerance.

Another disadvantage is that the price patterns may take longer to unfold and single-position drawdowns can be larger than normal, given the higher potential volatility in low-priced stocks.

There are ways to mitigate the added risks, starting with raising the minimum price and average trading volume and selecting penny stocks that trade on the NYSE or Nasdaq. Overall portfolio risk can be contained by allocating only a small amount of total capital to the penny stock market.

By carefully screening, watching, and waiting for price patterns to unfold, investors can access a market environment that has the potential for large gains in a relatively short period of time. But that depends on entering a position at the right time.

The Bottom Line 

Penny stocks have the potential to sometimes see sharp multi-week or month rallies that, on a percentage basis, exceed expectations. They can present opportunities for investors that are difficult to find otherwise. This article features five interesting charts of penny stocks that had advanced during the prior month and showed upside potential, given the presented technical analysis.

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