Penedo began his career with Estudiantes de Panamá F.C. and made his first team debut in 2000. He also played in Panamá for Plaza Amador and Árabe Unido. In his first season with Árabe Unido, Penedo helped the club to the apertura and clausura titles. In 2005 he joined Italian club Cagliari but did not make any first team appearances. The following season he moved to Spain to play for Osasuna B in Segunda División B. After one season in Spain Penedo returned to Central America, signing in Guatemala for Municipal. During his time with Municipal Penedo claimed four league titles.