Mosaic Chart Alerts

Inflation fears keep the Fed on hold.

In this post, I’ll focus on setups that I’m monitoring for both long and short positions. With a chart and short write-up, this is a quick way to scan and plan potential trades.

These ideas are the end result of my process to identify stocks offering the right combination of growth fundamentals along with a proper chart setup.

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Stock Market Update

Following their most recent rate-setting meeting, the Federal Reserve voted to keep interest rates unchanged at a target level of 4.25% - 4.50%. That’s despite the current level of fed funds being nearly double the annual gain in consumer inflation, which was most recently reported at 2.4%. That’s the most restrictive rate level relative to inflation since just before 2008’s financial crisis, but comments from Fed Chair Jerome Powell showed why the central bank is holding off on adjusting rates for now. Powell noted that “we expect a meaningful amount of inflation to arrive in coming months” due to the impact of rising tariffs. For now, the consensus view is that the Fed will ultimately deliver two 0.25% rate cuts this year. That reflects the Fed’s “dot plot” forecasts, market-implied odds for rate cuts, and the 2-year Treasury yield that’s trading about 50 basis points below fed funds (chart below).

While investor attention is on short-term rates this week, the real action could soon take place on the longer end of the yield curve. That’s because the 30-year Treasury yield continues trading close to the 5.0% level, which is resistance within a larger ascending triangle pattern. You can see the pattern in the chart below, which has been forming since late 2023 and mostly coincides with a period of disinflation since 2022. A breakout in the 30-year yield above the 5.0% level could be a confirming signal on the Fed’s fears of rising inflation in the month’s ahead.

While tariffs receive most of the attention when it comes to inflation fears, commodities could play a key role as well. The recent surge in oil prices is driving broad commodity indexes toward key breakout levels, which also perform well during periods of rising inflation. Commodities and related producers have been a key focus for Hub members recently, and we continue to track more setups in the sector.

Keep reading to see:

• Open ETF positions.

• Open stock positions.

• Chart analysis for new trade ideas.