DSI Says Gold/Silver Bottom Near but Just Not Yet

Bob Moriarty
Archives
Oct 29, 2026

My long-time loyal readers, both of them, well understand my position on sentiment. I bought my first stocks in 1970. I have always been a contrarian but finding good sentiment indicators is difficult. A few years back I discovered the Daily Sentiment Indicator (DSI) and thought I had died and gone to heaven. While it is not perfect in every top or bottom, it is by far the single most valuable data source for tracking sentiment.

For real contrarian investors there are dozens of alternative sources of sentiment. Every top or ever bottom will have its own correct measure of sentiment so as an investor, you need to track as many measures of sentiment as possible to trade profitably.

We are both in a crash for the stock market and nearing a bottom in silver and gold. I think this market looks a lot like 2008. The metals topped in March of 2008 and dribbled down for many months breaking the hearts of gold and silver bugs. In the fall they moved in lockstep with the general market as it fell off a cliff.

Tom McClellan has been pounding the table for a month or more that the metals will meet up with a 13.5-month low in the December -January timeframe. As of last Friday, the DSI for gold was 13 and 10 for silver. That does not mark a major bottom which is what we have coming. In my view the medals will be like a bride’s nightie with the general market. Think 2008. There were days gold plummeted and days when it rocketed. It will be a violent market.

But the opportunity for gold and especially silver is extraordinary. The metals bottomed in December of 2015 before shooting higher into August of 2016. Some index funds went up over 100%. With spot silver hitting $12 in March of 2020, you could buy the Sprott Silver SPLV at a record 10% discount or under $11 an ounce. Six months later silver was selling for $30 an ounce. It’s going to happen again.

I agree with Tom McClellan that the metals look to bottom in a month or so. I will monitor the Sprott Physical Silver Trust numbers closely. If you see the Historical Premium/Discount show a 10% discount, throw money at the ETF. Another excellent sentiment indicator, this time for the shares of resource companies is the Gold Miners Bullish Percentage Index or $BPGDM. It says we are not at a bottom yet. I believe the DSI for gold and silver will reach down to the 6-8 range for either. Market bottoms for the metals take a month or more to form. I will keep my readers informed as to how I see the sentiment.

This coming week is going to be an interesting but dangerous time. President Trump is going to make a decision as to the question should he attempt to destroy the entire energy platform of West Asia on behalf of the only nuclear armed terrorist state in the Middle East. If he attacks Iran again he may well destroy the world’s economy.

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Bob Moriarty
President: 321gold
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