Hi TJC,
Sept. silver the last was sitting at 38.90 which is just at around the breakout of the flag or something of a slanted channel. I took the height of the flag at the begining of where the flag was formed (in orange), and projected it down from the breakout point (in purple). It projects to about 36 short term. Seems today the overall markets were the dog and silver was the tail, so who knows what happens tomorrow.
Now if this is a correction in a bear market for silver then I would expect much more to the downside. Not based on the flag, but based on it may be a continuation of a bear market. Check out some of the charts Trades has posted in the past at longer term support levels to the down side.
I was thinking that silver might clip the 42.43 days high identified in the chart and move to the the 63% retracement level. My thoughts behind this are that it could reach the 63% retracement level for one. I put four green $ signs on the chart just above old days highs when the market sold off hard from around 50. Now if one got short and was able to ride this sucker down to the 32.35 level, where do they place their stop loss orders? My guess is slightly above old highs. I remember one commodity analysis saying that the market was like Pack Man and it goes around gobbling up stop losses because that is where you loose your money. Therefore, getting close to that 63% level would have been able to gobble up stops above the 42.43 level. Then maybe that would be the extent of the rally and it would turn back lower.
Like I said it is at the breakdown point of the flag, so we shall see what tomorrow brings.