Return of Risk

A hung Italian parliament provided the impetus for a sharp drop last Monday, and provided us with our first profits this calendar year. This could well be the precursor for the return of volatility we have been looking for, after the last 2 months of consistently rising prices. It was only a Ben Bernanke speech on Tuesday that rallied the market, although tellingly, not to the previous recent peak of 1533. We will re-enter our short position this week with an order to sell 3 contracts at the market open of 1517.5, should the market rally past 1522, we will short a further 2 contracts and set a stop-loss at 1535 for all 5 contracts. Our target this week will be prices below 1483 where we take profits.