There are any number of small cap stock forecasting services being marketed today which profess to numbers crunch actual market data and deliver what they declare are profitable penny stock picks so that you, the trader, need only to order the trades as you receive the market tips. Many of these services count on style over substance, and use their branding and promise of profitability figures to attract potential clients.

One such stock forecasting service which concentrates entirely on hot penny stocks has been raising some eyebrows lately among a certain sector of investors while adding to its own renown with the correctness of its recommendations in recent months. Mathematics whiz James Connelly's Penny Stock Prophet stock picking service focuses only penny stocks using a computer generated algorithm that chooses just when a stock is geared toward a breakout move in the market.

According to his website's information, James cautiously investigated the markets for over two years while laboring over a way to be able to predict when a stock was ready to breakout in a upward direction. He tested his theories over and over again, finally perfecting a complicated set of mathematical algorithms which he used to find the one key statistic which told him that a stock was prepared to make a big move upward.

That key statistic is the "psychological support level" or PSL. The PSL is nothing new in the trading world; it examines the activity of human behavior which causes a stock to be sold at well below its actual value. But what James also discovered was that being able to find undervalued stocks is not enough. You have to be able to find those stocks which are prepared to make a breakout climb upward. That's the hard part which kept him working at perfecting his formula.

He combined what he uncovered about the PSL with another mathematical logarithm used to predict how human behavior affects things like population growth, crime, and terrorism called psythometric science. He deduced: Why not employ this formula to the stock market? Using all this information combined with four other variables he had uncovered, James eventually developed a formula that helped him be able to predict a bullish trading pattern before it occurred.

It appears all but unbelievable, but his calculations actually do work. You don't have to take my word for it, but can test out his predictions for yourself. Just sign up for his free special report "Everything You Need To Know Before Investing In Micro Cap Stocks" on his website, and he will send you two free picks that you can track for yourself. I wouldn't have thought it possible if I hadn't seen it with my own eyes.

What makes Connelly's model of investing in top penny stocks so profitable is the amount of financial leverage that the small investor can gain by using these tips. Because you are investing in penny stocks, you don't have to come up with large investment amounts in order to achieve sizable gains. For example, investing in a thousand shares of a stock at .30 cents a share (a $300 investment) which after a few trading sessions rises to .90 cents a share translates into a $600 dollar profit.

James Connelly's Penny Stock Prophet is well worth examining if you are a stock market investor looking to protect your investment principal or are searching for a way to set up an income stream using penny stock investments as your platform.