I haven't been around for a while mainly because I've been shorting silver and I know there are a lot of die hard bulls here.
I know what the fundamentals say but price is the truth. Silver has blown through all types of downside targets with ease.
50% retracement of the move started in 2003 from 4.49 to 49.52, was 27.50 or there abouts. That got knocked out, not easily, but after 2 yrs of trying.
The next fib number is 62% (rounded) and that comes in at $21.60 SILVER, where the price sits now. The problem is $21.60 got smoked by more than a dollar which to some will mean it has yet further to go downward. To others it will mean that was a capitulation sell but the problem in accepting that theory is how this occurred on a Sunday night. A capitulation sell would need to include volume and the few thousand contracts involved sunday night does not represent large enough volume.
So I turn to gold, and gold is supported at 1350 by traditional chart analysis. When encountering support or resistance prices, very rarely does the price push through on the first temp, something likely 80% of the time the support/resistance holds. So, there should be a bounce upward in gold from here which would sustain bullish silver prices.
Large money plays trading from a risk perspective, and the shorts are now looking at this and saying there is less reward available after a 62% move and more risk especially after reaching such a clear fib number.
Summary: if you're a bull don't rush out and get long, a bottoming process will likely take all summer.
The dollar should be exhausted after reaching 84.02. So, there are a lot of stars aligning here. If it can turn downward this will also support gold/silver.
Check out Louise Yamada on Yahoo Breakout, she is pretty much aligned with your post. Right now, I do not know what to think so I am holding a largepercentage in cash with a core position in SLW. Just curious, are you still short silver or have you covered?