Lessons learned from a new investor

Well I'll add what limited knowledge I have, as I am finally starting to see some small profits coming out of my choices. I don't understand most of the terminology you guys are using like 90% of the time so bear with me :). As of now most of my game plan has been based off having very little to buy with, so this is aimed more at inexperienced investors with very little (I'm talking under a grand) who may be feeling frustrated and overwhelmed.

So far the most successful method I've discovered to making some profit has been to research the company after it's already seen some growth. If I feel the company is strong, and has a good product, I wait for some overzealous day traders to destroy it, and pick up as much as I can when it dips, or just buy it if it seems likely to grow again the next day. Just about every time I have jumped in because the stock was going up and someone posted an alert on it, knowing nothing about the company beforehand, I have lost out. The last few instances I actually took my time to do some research before I bought in, the stock either went up and I profited, or at the very least maintained the price I bought it at.
If any other newbie investors can back me up on this, when you don't have a lot of money, a big mistake can not only hurt you, but paralyze you from trading completely, and I think as a result we have to be a bit more cautious then normal traders. With the limitations on my account, day trading is next to impossible, because the moment I buy something, and then sell it later in the day, I can't use that money for a while until the funds clear.
Since I'm so limited, when I buy in to a stock, I have to buy in big to see any noticeable profit, and to get the most out of the time I have for that week. This also means greater risk when most of your money is in a penny stock, but I've found it necessary to learn to deal with, because it's difficult to make any money off a stock you can only buy 100 shares of.
So the successful trades I have made pretty much revolved around these steps. This is the safest way I have found to approach messing with penny stocks.

1. Stock A shoots up, doubling in value! People all around the net are buzzing like excited worker ants, wondering if it's a good time to buy or not. For someone without a lot of money, it probably isn't.

2. Observe the company's past growth. Has it been in the dumps since day 1? Has it been steadily rising before this jump? Has it been ping-ponging back and forth for several months? If it's done anything other than the first one, it's research time.

3. Look for what Stock A did to get this bounce. If no information is available as to why, don't touch it, it's probably a fluke or day trader pillaging. Look for things that promise more things like "Company A planning to announce Action/Report/Earnings XYZ" or "Company A makes discovery B, commencing production by XYZ date" At least with info like this, if the stock goes down after the initial buy, there's a decent chance that the next event to occur will bring your stock back up. Buying stock in a small company that announced a singular positive event has a good chance of just dropping down after the buzz has worn off, and quite possibly just die off. After all it didn't mention more good things to come, why should you take a chance on a complete unknown?

4. If the reason for the growth seems to be something that could continue in the future, now look at the company itself. Does it have a product that you believe people would want? For this part I rely more on my own judgment, remember were doing this on the internet, where stupidity and ignorance reign supreme. It doesn't hurt to weigh advice, but if there aren't a million strong detractors, and your own personal experience gives you reason to see potential, trust your instinct:)

5. If the choice seems solid, research trash talkers. Try and dig up as much dirt on the company and the people who run it as possible. To a new investor, a pile of garbage can seem like a mountain of gold, and when you've decided you want to buy, it's time to find a second opinion. I've avoided buying several stocks due to forum posts, web articles and the like from people that actually provide some hard data, and when it dropped like a ton of bricks the next day, I was able to chuckle smugly to myself that i didn't fall for the bait that everyone else did.

6. Stock A meets my requirements. It's seen growth before and/or has experienced heavy volatility. The growth came from information that also suggests potential for more growth in the near future. The company seems stable, it's been around a while, they have something that can keep it around for a while longer. There is minimal evidence against Stock A, or the detractors talk like 13 year olds "WHERE IS THE ANNUAL REPORT???? LMFAO
THEY TRIED REALLY HARD TO GET IT OUT...DIDN'T THEY//HAHAHAHHAHAAHHAHAH " (I took that from a real post by the way, that guy has made a ton of posts about that stock. It seems strange to me that someone that wants nothing to do with a stock would spend so much time talking about it. With no back up info. In all caps.)

7. It seems like a good buy, it could still be a scam, but heck, most penny stocks probably are. Quit being a wuss and jump in when the timing seems right. And I'm sure you've all heard this by now, but only invest what you could live with losing. Nothing is for certain, but that's part of the fun :) (Famous last words, hehehe)

In the event of a massive loss. Take a deep breath. Go outside. Get some exercise. Scream at a tree or small harmless animal. Regroup. One of the good things in not having a ton of money to invest is that your not losing all that much anyways, you can learn from your mistakes, and recover for the future. Hope this was helpful, good luck out there guys.