These factors led to a tumble in most OTC stocks. Marijuana legalization was brought to a halt; SEC amended its Exchange Act Rule 15c2-11 provided more strict regulations that provided less liquidity to the OTC. Retail traders in the OTC had the emergency breaks pulled on them by some retail brokerage firms months before Rule 15c2-11 took effect in late September of 2021. Further, to make matters worse all this negative news allowed institutions and market makers to take advantage and short stocks on the OTC.
Moreover, this forced most OTC companies to reverse split, dilute, take out toxic loans just to stay at float based on their situations. Others simply just went belly up or are still trying to find the means of getting back current so their company can be priced correctly and publicly traded by retail traders once again.
All these factors played a role in a constant spiral downward movement for over 10 months. After most of the losses have been absorbed it seems like the OTC Markets is ready to run back up. Marijuana on the brinks of federal legalization. OTC stocks who are current will need to keep staying current by providing updates in a more proper manner to be listed. In short, all the negativity that occurred with OTC grey markets either discouraged or halted retail traders from trading certain stocks or most OTC-related stocks. if you are new to trading you can create a free account with Traders Circle and reach out to a Trading Mentor on the first marketplace ever created for trading educators.
As the year 2021 came to an end, we managed to see some green blips appear in the OTC world with indications of the worse is over. Even short covering may happen with some or most penny stocks as we do see some stabilization in the final trading days of 2021 and green days in the early days of 2022. If penny stocks can stay current and provide updates of their business progression without further diluting, reverse splitting or taking out toxic loans, there is a great possibility that OTC stocks will run once again. The penny stocks arena has changed and hopefully for the better after Rule 15c2-11 was amended and took effect. The stocks that are on my radar are trading in the following sectors:
Marijuana Sector: These stocks received a beating in the last several months due to the delay of federal legalization. The 2021 chapter has ended but they seemed to have stabilized in the last few days before the year ended and gained ground on the first few days of 2022. Must be selective but these are my favorite cannabis plays in 2022. Hemp Naturals Inc. (HPMM) with 2 acquired locations one in Maine and the other in Plattsburgh NY a $5 billion annual market in New York State alone. CBD of Denver Inc. (CBDD) generates roughly $30 million annually and on the verge of GAAP filings completion, CBD of Denver conducts its business in the United States and Europe. VPR Brands LP (VPRB) is a profitable vape company with utility patents that have been violated. Sundial Growers Inc. (SNDL) great marijuana stock that has proven to be the top marijuana stock in pennyland; SNDL created a triple bottom and is poised to run hard in the coming days and weeks. I really think she is the one to watch, if SNDL runs most cannabis stocks should follow.
Crypto Sector: This sector is in infancy but there are stocks in the penny arena that deserves to be noticed. Net Savings Link Inc. (NSAV) there is too much to list on why this company is my favorite cryptocurrency business! Let’s just say this company reminds me of the OTC but for cryptocurrencies and NFT’s. BitFrontier Capital Holdings Inc. (BFCH) got hammered after her run to 52-week highs of 0.54, a cryptocurrency mining company that is probably one of the best mining companies in the OTC world and plans to up list to the OTCQB from the bulletin boards.
Technology Sector: There are some amazing tech start-ups that are trading in the over the counter pinksheets markets, the two stocks I think you should keep your eyes on Tautachrome Inc. (TTCM) they have created ARknet, this could be the penny stock of the metaverse arena, investors and traders should keep your eyes on this one. Social Life Network (WDLF) runs multiple social networks and launched WDLF coins for their networks, they also plan to release e-commerce stores on their networks. This could be promising for Social Life Network investors as HuntPost has more users than etsy.com (ETSY) and the WDLF coin can gain value fast if more users join and buy/sell products on their eCommerce platforms for Social Life Networking arena.
Conclusion: Investors and traders who have been waiting on the sidelines might have a great opportunity to cherry-pick the bottom of these penny stocks. The OTC Markets went through a downward cycle, but now we see most stocks in this arena creating support and may run hard in 2022 as most stocks in the OTC Markets will try to stay current and follow the proper guidelines for Rule 15c2-11. Remember, if you are new to trading you can create a free account with Traders Circle and reach out to a Trading Mentor on the first marketplace ever created for trading educators.