There was really no way to see this one coming but as the election news came out, it was pretty clear what it all meant. I knew the markets would hate a strong showing from Berlusconi but I would have never guessed they hated it this much.

At some point the collapse stops and then yen resumes weakening but it’s rarely ‘V shaped’ move. If you want to buy yen crosses, wait for the bleeding to stop and look for a sideways move.

With the euro, it’s a bad result but the market can withstand another election in Italy. That said, it will be dicey and the Italian bond market hates Berlusconi.