Nearing a panic buying opportunity in mining stocks

When it's over, we're going to be able to buy the highest-quality stocks in the sector for 2009 prices The rout in junior resource stocks just took another serious leg down... We were watching the TSX Venture Exchange index – the benchmark for small exploration and mining stocks. We identified two bearish milestones. We blew through the first one in late March. We just crashed through the second on Monday. Now things are going to get really dangerous for investors... The Venture is down 46% from its March 2011 high. It has dropped below its 120-day moving average (DMA), a standard trend measurement. And as of Monday, it's below its October 2011 low, a major breakdown... With prices down so far, you might think it's time to bargain shop. But it's likely things will get worse before they get better... You see, junior resource stocks have a unique business model. Exploration work is expensive. These companies need to raise money to do it... But they have no assets or earnings. The only thing they have to sell is stock. Continue reading this article here.