Here is a quote from Roulston:

In addition to investor fear, the junior resource markets face a major challenge of their own making. Investors poured billions of dollars into this sector in the past couple of years. Much of that investment was badly placed. While resources were in vogue, investment managers the world over were tasked with placing vast amounts of money in small companies. Lacking the skill and experience to differentiate among the literally thousands of companies in the space, the money was strewn far and wide.

Not surprisingly, many high risk investments failed to pay off and the fundamental values of many of the companies plummeted. Those same investment managers who came naively into the sector are now facing redemptions. The selling is as indiscriminate as the buying was. In fact, the better companies in many cases are being hit harder than the outright dogs: The good companies at least attract a bid.

It is my belief that many companies will continue to be pushed lower as investors unload their shares into a market with few buyers. Those investors who know the industry well are patiently accumulating the companies with sound, fundamental value.

As a result, the “market” may continue to go lower. The higher quality companies are finding bottoms. Now is the time to be accumulating shares of carefully selected companies