This was a bad mistake. I was overexcited by the possibility of a news-breakout after the UK Q4 GDP number came in very weak. Almost immediately, however, the MPC minutes showed that there were two votes for a rate hike at the latest meeting, and that refocused the market on inflation and the chance of future rate increases. Was the news-breakout not a real one? Yes, it was, but breakouts are a signal that works in the direction of the trend, and, if there is a trend in this market (which is questionable), it is downward, as the following chart shows.

There is no room for this kind of sloppiness and I have made some changes to my process in an attempt to stop it happening again.
Advertisements