Today silver dropped 7%:
NEW YORK/LONDON (Reuters) – Silver plunged about 7 percent, while gold fell to its lowest in more than five weeks late Friday, as a rallying dollar, weaker base metals and the bullish stock market triggered heavy selling by funds ahead of the weekend. Spot silver fell to $12.82/12.89 at 4:30 p.m. (2130 GMT), down from $13.76/13.83 late Thursday. It hit a low of $12.77, lowest in about four weeks. New York Mercantile Exchange March silver accelerated its loss in late trading, plummeted to a four-week low, down 97 cents, or 7 percent, to finish at $12.980, Leonard Kaplan, president of Prospector Asset Management, called precious metals “way too high,” and said fund selling was behind the markets’ decline. “When the dollar started to turn around, all the funds got out at the same time, creating enormous volatility,” said Kaplan. “You see the funds liquidating everything. They are selling grain. They are selling copper, everything,” Kaplan said. Kaplan also said that when the stock market could not maintain its new highs, it was the signal for investors to sell, including commodities. “The sell-off certainly began with the dollar-friendly economic data,” said James Steel, analyst at HSBC. “It’s not just precious metals, the base metals were down quite a bit too.” he said.
It was an exit. Pure and simple. You don’t see this type of decline from the assessment of fundamental factors or new economic views. This was technical. I see the comment that silver was “way too high.” What’s high? High to what? I wonder if AP would ever give me the opportunity to offer a less BS view on price movement. I am betting that unless I could tell them “why” something happened they would not hire me!