Subscribe to the Peter Leeds channel: https://www.youtube.com/user/PeterLeedsPennyStock?feature=watch
Technical analysis with penny stocks is only effective when there is enough trading volume in the shares. For example, if 35% of the total outstanding shares trade hands while a support level forms, that pattern can be trusted to hold up. On the other hand, when a support level appears to be forming in a penny stock, but it does so on only 2% of the shares traded, it is much less likely to be reliable.
In other words, with penny stocks, more trading activity means that there will be more reliability in an technical analysis patterns which appear.
Technical analysis does not always work with penny stocks. However, we find high quality companies first based on fundamentals, then apply technical analysis (TA) to find the best buying and selling prices.
You can see more videos about penny stocks just like this one here: https://www.youtube.com/user/PeterLeedsPennyStock?feature=watch