It's possible that your website had a sitewide link on another website. That may mean it was in the "Recent Posts" category in a widget box or any other location that would be seen on every page of that site. Once that website added enough posts to push your link off that widget, you would no longer have a backlink on every page of that website. Therefore, your total links would drop dramatically. Furthermore, if that website received a fair bit of traffic, the link would no longer be shown to those visitors and ergo, the traffic would also decrease.
Hope that helps.
