Be Careful with Your Birds, Jay

After sloshing around for the first forty minutes or so after the FOMC decision to raise by fifty basis points and commence a baby step QT program next month, stocks catapulted higher as Fed Chair Jay Powell in his presser decisively said a seventy-five basis point rate hike was not even under consideration. 

While Powell also made some superficially hawkish comments, too, during the presser, the reality is that one cannot fight inflation adequately while trying to walk a fine line between dove and hawk, or a "market friendly" hawk hoping for a "soft landing." Inflation must be fought decisively and aggressively, otherwise it will worsen and financial assets levitate. 

To make matters worse, Powell may have given the green light for commodities and their stocks to sky rocket now. Understand that the actual inflation rate is still running much, much higher than the Federal Funds rate, which means it is highly unlikely that inflation recedes anytime soon. 

U.S. Steel, on its weekly chart, below, is a prime example of a commodity names which can catch a rotation now. Note how it pulled back to prior resistance and is trying to stabilize here.