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[PIK.]

Small caps represented by the Russell 2000 are currently in a clear short term consolidation pattern after reaching the under side of resistance. Price relative to the S&P 500 is testing the rising bottoms line again which has produced price increases since the October lows. If price fails and falls from the short term pattern, more than likely it will coincide with a change in its relative strength and leadership. Keeping in mind that the Small Cap 600 index has already reached its all time high may be placing higher odds on an upside break of the pattern and continuation of leadership. For now, an important test for the small caps to see if they can continue their leadership role on an intermediate term time frame. Click on chart to enlarge.

Edited by PIK., 27 February 2012 - 06:58 PM.