Is silver too overbought?

The recent run on silver (SLV) since the beginning of February has been incredible. Due to a weak dollar and heavy speculations this commodity is now valued over $47.
Today the Fed spoke about keeping interest rates near 0% even though the economy is growing. This fuels inflation which automatically means the US dollar is getting weaker.
So now the question is, what's going on with silver? How all of a sudden has this become such a precious metal? Well, it actually hasn't.
Like I said before, the weak dollar and traders that are seeing the silver charts breaking all the resistance levels on their screens to new key levels are to 'blame' for the sudden spike in silver.

But is silver overbought?

As you can see in the chart above, silver (SLV) is definitely in the overbought territory, and it has been like this for a few weeks. To answer the question whether or not it's too overbought I think we have to look at the 'rate of inflation' by looking at this time at the US dollar index.

On the chart above you can see the US dollar isn't doing to well. (A steep decline since July). A reason why the US dollar is in question to remain the world's reserve currency, but that's another story.

Now, back to silver, in other words in order to calculate the 'true value' of silver I think we should keep the rate of inflation in mind. To me, the rate of inflation is out of control! In fact, I think we should have raised interest rates, a long time ago to tell you the truth. But it is what it is and this is the market we have to work with, so when it comes to the actual price to silver it may seem like an incredible spike but it's really not due to the devaluation of the US dollar.

Another reason is, ever since the earthquake and tsunami in Japan, the global markets have been pretty steady. What that does is encouraging and engaging investors around the world to invest in assets and markets other then the US dollar. (You see investors in difficult economic times flocking to the safe haven of the US dollar, adding value to the US dollar index, and likely to the VIX).

It's only a matter of time for silver to pull back, and I think that's going to happen very soon. Yes, even with all the factors and scenarios I mentioned before, I just don't think the US dollar is going to weaken that much that the 'true' value of silver is going to be overpriced.

In this case I'm not going by the 'trend is your friend' theory and short silver withing the next few days, depending on if certain key levels are breached.

I'm bearish on Silver (SLV)!

SLV last 5 trading days;