Taxonomy Arguments in Views Block

This is confusing stuff...

What I would like is to create a single block in views that knows where it is.

So if I am looking at a node tagged Warhol, there will be a block that displays relevant content also tagged Warhol. Obviously I can create a bunch of these blocks in views per taxonomy term and assign them via the blocks admin but I' looking for something more automated if possible

I would like block to know that it is on a node tagged "x" and the block to display node titles of other nodes tagged "x". I intend to use the block in a panel.

Can this be done with arguments? I was hoping someone would give me a push in the right direction or inform me it is not possible.

If I can't figure anything out I will probably just use the Similar By Terms module which appears to do just that (I really wanna do it with views if I can though).

Thanks
Chris