pagination not working for category.php (custom post types in categories)

<?php
$catname = wp_title('', false);
$wp_query = new WP_Query();
$wp_query->query('category_name=".$catname."&showposts=5'.'&paged='.$paged);
?>

<?php while ($wp_query->have_posts()) : $wp_query->the_post(); ?>
<?php the_title(); ?>
<?php } ?>

<?php endwhile; ?>

<?php next_posts_link('&laquo; Older Entries') ?>
<?php previous_posts_link('Newer Entries &raquo;') ?>

I think that you need to look at the $paged variables.