My traffic has been going up and down like a roller coaster for over a year and I think I've finally figured out the problem. It took several months to gather enough records.
Whenever the 404 errors in Google Webmaster Tools get to a certain point (about 50), which are all due to typos --because I don't have any broken links, then my traffic drops off until I remove the errors then it picks right up again.
The chart for errors doesn't follow the chart for traffic because once Gwmt reaches about 50 errors the traffic drops off but the errors continue unless I remember to go into Gwmt to remove them. But soon as I remove them the traffic picks up within a week.
Anyone else see this?