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It is quite irritating while you are typing and mouse cursor comes in the way and you can't see the text clearly. .
I have been searching a solution for this problem and luckily found a software which can easily hide cursor while typing in windows xp. Cursor Hider is the little free software that removes the mouse pointer while you are working with the keyboard.
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There is also a setting inside windows xp for doing the same but trust me it never works, you can see this option in the screenshot below.
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