Don't use yesterday's news to forecast tomorrow's markets.

Many  people  make the  mistake of forecasting the stock  market on the  basis of current economic data  (which  usually relate to developments of at  least a  month ago). T his  is a  mistake  because the stock  market  leads  rather than follows the economy.  It  makes  more sense to  use the stock  market as an  indication of what the economy  is  likely to do  in the future .  By the time that the economic data  has confirmed a trend, the  market  is often discounting the  next  phase of the cycle . The  market  is forward  looking while economic data are  backward  looking .

Don't use yesterday's news to forecast tomorrow's markets.