FSJG Index™ Weekly Review
by Frank Barbera
September 23, 2005

After breaking above its medium-term downtrend line early this week, the FS Junior Gold Index went on to close with a solid gain this week. Ending at a reading of 167.36, the Index was up from last week's value of 164.65. For the week, the FSJG Index gained 1.64%, which left the index virtually right on a 6-month high. With the Friday close of 167.36, the index is still comfortably above its 50-day moving average at 153.53 and the 200-day average at 155.41.

There is a good chance that if the gold sector continues to rally next week, the 50-day average will cross above the 200-day average confirming a renewed intermediate-term uptrend. Perhaps the most interesting aspect of this week's trading on the FSJG Index was the change over in leadership, which took place as the Small Cap Golds actually outperformed their higher-cap brethren for the first time in many months. Both the XAU and the HUI ended modestly lower, losing around 1% for the week.

Another important change was seen in the action of the FSJG Sub-Groups where the Junior Producers gained .008% for the week versus gains of 1.53% for the Junior Development companies and a gain of 3.49% for the Junior Exploration companies.

On a relative strength basis, the leadership is still in the Development companies where the index ended at 508.56 up from 500.90 and is now very close to the high seen on April 7, 2004 at 527.59. I am encouraged to see the Development and Exploration companies beginning to catch up as that indicates more capital flowing into the precious metals resource sector, which is always an indication of a healthy advance.

The Junior Producers index above moved a little better than the majors this week, but overall traced out a flat pattern, taking a pause after several weeks of strong advancing action. The Development companies produced their third consecutive weekly gains and ended near multi-year highs.

Exploration Stocks are showing their first signs of life in quite some time, as both volume and prices notched decent gains on the week. All in all, the secondary market for Gold Stocks appear to be improving in the wake of strong gains seen in recent weeks among leading mining companies and gold itself.

*Please note that the individual companies in this index are proprietary and will not be disclosed due to compliance and regulatory issues resulting from the relationship of FinancialSense.com, Puplava Financial Services, Inc., Registered Investment Advisor and Puplava Securities, Inc. Member Firm FINRA/SIPC.