And, he says, "over 50 percent of silver's demand is industrial demand." With the Fed calling attention this week to the chance of significant downside risk in the economy, traders are concerned that slower economic growth will translate to reduced demand for silver.
Other industrials moving lower include copper, platinum and palladium.
Traders talking about "massive liquidations" and new shorts adding to the selloff.
"We’ve seen a big fund-related selloff across the board yesterday and today, with even gold seeing big declines," says David Wilson, director of metals research at Societe Generale.
"Fears over a Greek default in particular have prompted a rush to cash (the U.S. dollar in this case)" and therefore, a decline in demand for dollar-based assets such as silver.
"We have had strong selling, as the USD has rallied and money flowed into Treasurys," says Jim Steel, chief commodities analyst at HSBC. "All the precious metals have weakened in sympathy with other commodities."
Despite double-digit percentage declines in Friday's sell-off, silver returns are about flat year-to-date. In addition, margins are relatively high — around 9 percent of the value of the contract versus three to five percent on average. For investors looking for a source of funds, those are two more reasons to sell.