From Grace Cheng’s blog today:
The BOE quarterly inflation report prompted long profit-taking actions in the British Pound after the bank said it could comfortably allow interest rates to drop from their current level of 5.75% to around 5% without inflation getting out of control.
BOE governor King said he expects GDP growth to slow “sharply” in 2008 and the bank forecasts at least one rate cut in 2008.
“Further financial market fallout, either at home or overseas, poses the biggest downside risk to activity,” the report said.
EUR/GBP rallied to a 4-year high while GBP/USD fell 200 pips today to around 2.0660.
Fundamentally noisy. LOL. So now everyone should trade the market based on a rate hike due next year? That’s how analysts got their job, isnt it?
And market gurus wud say “buy rumors, sell facts”. Ya ya ya..
I’d prefer we just “Buy/Sell the FACT”. No rumors.
Only the FACT. No Noises.
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I’ve came across this article in a website. The tittle is “Modern Day Darvas Methods“. The article is very interesting because it highlighted the essential idea in the famous book, “How I made 2MM in the Stock Market” by Nicolas Darvas. The article stated,
“The book outlines how Darvas became a successful trader by overcoming his own mistakes through his ‘box theory’. Having gone through several different methods without finding any consistency in profitability, he ultimately became a chartist and a millionaire – imagine that!”
The article went further describing the book with more details on how Mr. Darvas prevent himself from “micromanaging” his trades,
While traveling the world by way of his profession as a dancer, he received his weekly copy of Barron’s, and reviewed his stocks of interest through these quotes which were delayed by days. After reviewing the prices and locating his favorite chart pattern, he would wire detailed trade instructions to his broker. Although today’s markets move faster than they did back then, at the end of the day he was simply focused on the price action and how his stocks were moving – just as we all should be. This means he was not being distracted by the extra “noise” of every tick, geopolitical news, rumors or sentiment.
I would put more stress on the last line: “…he was not being distracted by the extra “noise” of every tick, geopolitical news, rumors or sentiment..”
I couldn‘t agree more on this. Geopolitical news, rumors or sentiment, are nothing BUT NOISE. Just filter it out from the process of making trading decisions, and we’ll have a clear day 
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Get rid of the noise like this.
