Consolidation

We have closed between 1250-1258 for the past 3 sessions, tightening the trading range.  I expect a 50 point move out of this consolidation over the next several days.  My belief is that it will be down.  Mainly based on the continued underperformance of European equities, growing complacency, and Italian 10 year bond pressures.  The Italian sovereigns are heavily owned by the European banks and any kind of run on those bonds would put extreme strain on the balance sheets of the European banks. 

A short around 1270 would likely be profitable in the intermediate term.