(Editor’s Note – just to be clear, the post below is written by TNRevolution, not me!- Tim)

No, that wasn’t a typo.

If you frequent the comments section on the Slope, you’ve undoubtedly noticed a change in my viewpoint on the markets over the past couple weeks. Let’s take a look at why.

Starting with the Russell 2000, the market has seen multiple genuine opportunities to see significant weakness this year. They have all failed to this point. I have circled each opportunity on the chart below. Beginning with the drop in January of this year, the Russell broke down out of it’s rising wedge off the November 2012 low. This was a well formed wedge. We saw an initial drop down to the 1080 level, followed by a move higher to new highs and a backtest of the wedge. After the backtest, the Russell began to fall away again, leading to another good bearish opportunity. The decline again stalled at the 1080 level, moving higher, thereby making 1080 a key support level on the Russell. The final good bearish opportunity came in September of this year, as the Russell broke down out of its larger rising wedge off the 2009 low. This breakdown was also followed by a breakdown of the 1080 level. Prices stayed below 1080 for over a week, reaching a low of 1040. However, prices began to move higher, and retook the 1080 level, continuing higher since. (more…)