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Italy drops through compressions, Austria too Sell the usual candidates

We have been waiting for the Italian equity index to drop through the compressions reported to you and it now seems (finally) to be happening. The market has dropped a little and kept compressing day by day which has stopped us issuing the expected ‘sell short’ signal. Even though the market does not close for another 2 hours, we now think that this is a ‘good’ break down. To confirm this view, there has been a ‘crisper’ compression in Austria, which has also now broken down. There are adequately liquid futures contracts on an Austrian market equity index (the ATX), so this too becomes a short-sale candidate along with Spain and France, as usual. Charts:

More soon,