Shares of penny stocks Naked Brand Group Limited (NASDAQ:NAKD) and Sundial Growers Inc. (NASDAQ:SNDL) have each held above important support levels. This could set the stage for new uptrends to form.

Support is a large group of buyers who are trying to pay the same price for their stock. At support levels, there is more demand than supply. That’s why selloffs end or rebound when they reach them.

For Naked Brand's stock, the key support is at 50 cents. The stock rallied off of it on Monday.

80 cents is the key level for Sundial. There’s support at this level because it was resistance in May. Many investors who sold then regretted their decision when the stock traded higher.

They decided to buy their shares back if they fell back to 80 cents. The large amount of buy orders that they placed at this level is what caused support to form.