The Fed held interest rates steady yesterday, in its first meeting of 2026.
That keeps the target range near 3.5% – 3.75% after three cuts late last year.
And the pause pours more gasoline on a market already overloaded with catalysts …
Yes, the politics matter.
We’re not here to be political. But we have to talk about the elephant in the room, because it’s now part of a larger market catalyst: Pressure from President Trump has escalated into a very public feud with Fed Chair Jerome Powell as Powell’s term nears an end.
See the headline below:
Translation: More uncertainty and volatility lies ahead.
Don’t worry, that means more trade opportunities for us.
After slashing rates to zero in 2020, hiking hard through 2023, and trimming three times in late 2025, the Fed is determined to prove it can hold off inflation without crashing the economy.
And every time Powell defies Trump, the temperature gets a little hotter.
The market isn’t short on catalysts in 2026. Far from it.
Every week that you sit on the sidelines is a week of missed opportunities.
The Feud For The Fed
Trump has railed against Powell since his first term, openly musing about firing or demoting him in 2018 and 2019 when the Fed was hiking rates.
Reports at the time said Trump asked lawyers if he could remove or sideline Powell. An unprecedented challenge to Fed independence at the time.
This month, the Justice Department served the Fed with grand jury subpoenas tied to a multibillion-dollar headquarters renovation. An escalation Powell publicly called a pressure tactic. Major outlets corroborated the subpoenas and Powell’s statement.
Powell’s four-year chair term ends May 15, 2026. That makes each of these meetings part of his final stretch and heightens the political stakes around every decision and press conference.
Yesterday, at the first meeting of 2026, the Fed held rates steady after three cuts in late 2025. Which subsequently pushed back on political pressure to cut rates faster.
Powell stressed data-dependence and Fed independence during his meeting announcements.
Trump allies have been vetting Fed Chair successors for months. Recent reporting says the short list is down to “three or four” finalists. The challenge, per Wall Street Journal analysis, is finding someone who will cut rates while still commanding market credibility.
This story is far from over.
The catalyst firehose in 2026 isn’t waning. Get on the right side of this momentum!
Post Fed Decision Plays
The Invesco QQQ Trust (NASDAQ: QQQ) hit fresh highs before the announcement, dumped on the headline, then bounced during after hours.
That’s a market telling us it can go either way, and fast.
What I’m watching next:
- If traders wanted a rate cut and didn’t get it: We could see a clean pullback as disappointment sets in. I’ll look for weakness early as a possible entry for Put contracts.
- If the pause was already priced in: The crowd can flip right back to risk-on and keep pushing higher. In that case, I want strength to prove itself and then I’ll look for a simple and quick continuation higher.
You don’t have to predict. Let the market’s reaction show you the plan:
- If the price action is heavy, think “quick Put trades or sit tight.”
- If it’s strong, think “quick Calls with fast profit takes.”
- If it’s choppy, do nothing. Patience is a position.
I’m focused on the QQQ for a clean read.
This is a headline-driven market and yesterday’s decision added some real fuel to the fire.
You don’t need to catch the whole move, just a piece of it when momentum shows it’s picking a side.
Keep an eye on your email. I alert specific trade setups.
Stay Street Smart,
Jeff Zananiri
