OK Then, My Bad. This brings me back to my original answer, or opinion. Lack of liquidity. You might find it easy to purchase a position in a penny stock but very hard to sell, at least hard to sell at your price. Huge spreads. See above paragraph. Lack of institutional following. Most people buying them are buying on a hope and a prayer. There is nothing driving the price in any direction. This make traditional technical analysis very unreliable therefore how do you time your entry or exits. As for your last statement, it's not that you SHOULDN't but them. It's just that you should know all of the above before buying them and don't have great expectations. Know that your position is hardly more than a lottery ticket.
There is nothing with trading penny stocks as long as you understand the risk and problems associated with them. If you are mathematically inclined, you can use option theory to 'price' penny stocks. Treat the market capitalization of the company as the option premium. Just some food for thought. Good luck.
You have to understand the psychology behind penny stocks. Since they carry such a low price, you have many people who seemingly pile their entire account balance into it thinking that this will be the lottery ticket stock. There is sometimes a lot of emotion just like at a race track. Sometimes they are right, othertimes they are wrong. This is gambling and not traditional trading or investing. The information I am about to give you has no relation to trading or investing since its a form of gambling. As such, the possibility exists to lose a good percentage, if not all, of your capital. If I were going to trade stocks under 5 dollars, then I would go to a simple stock screener and look for stocks hitting their 52 week highs on good volume. Then I would study the chart pattern and come to a conclusion as to whether the pattern will continue upward. I would also look to see how much is in the float and steer myself towards companies with floats under 20 million shares. When I say "study", I mean to consider all of the different variables such as bollinger bands, moving averages and then the actual chart patterns themselves. A comprehensive look. Then I would develop my list and jump on one that has good momentum where I would believe it would move from there. It would be a short term trade lasting probably days and then I would exit when I felt the chart dictated it. If I were you, then I would experiment with a small amount of cash (like 1000 dollars) and gamble (notice how I didnt say trade) with that amount first. Whatever you do, never use margin on these equities. If you were looking to gamble over the long term, then you should do it when the market makes a significant correction like last May. Look at the Wilshire 5000 and wait for it to correct at least to the 200 day moving average. Then begin your scans for the pennies. If the so called "tide", starts to recede then all the pennies will do so as well. Now might not be the right time. I say do it during July and August.