Penny Stock: LTUM

Trading any penny stock is a big gamble. However, with some research and patience, we can turn this high risk trading in penny stock into great reward.  I have been following Lithium Corp, part of technology sector, past 6 weeks. I have noticed something recently that I wanted to share with everyone.

First of all, the support level for LTUM is between $0.95 - $1.00 and the top resistance level resides at $1.40.  As you can see LTUM has been trading pretty much in between the resistance and support levels.  I have circled two volume areas for discussion.  The first circle, smaller of the two, occurred when LTUM rallied to $1.40.  However, after hitting its resistance, it decline in the next month and eventually reached its support at $0.95.  Immediately after hitting its support, it rallied again and is about to reach it resistance level at $1.40 again.  This time it rallied with even higher volume, marked by a larger circle.  This is a key evidence that LTUM is gaining momentum.  I personally went LONG today in LTUM at $1.26.  I do think that LTUM now has a better chance of breaking its resistance level this time especially due to higher volume.

Keys to Watch:
  • I will be keeping a close eye out on the volume everyday.  I am hoping for the volume to maintain its current level.  Falling volume could mean LTUM is slowing losing its momentum.
  • If LTUM trades below $1.20, then I will be exiting this position.  It could be headed towards its support at around $1.00 again.

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