While investors and central banks around the world worry about deflation, one trader who relies heavily on the charts thinks there are actually some signs of inflation on the horizon, and that could spell trouble for stocks.
"The markets are in a very interesting period," said technical analyst Todd Gordon on Wednesday's "Live Trading Nation." "If you take a look at bonds selling off and commodities rallying, the charts are starting to look like there may be a bit of an inflation trade coming in here."
The TLT, the ETF that tracks long-dated treasury bonds, has sold off sharply in the past month and is trading at year-to-date lows. Meanwhile, commodities such as copper and crude oil are rallying, up 7 percent and 17 percent, respectively, in the same period. This as the dollar has begun to weaken. Taken all together, Gordon said investors could be overlooking a warning.
"I'm not exactly sure where it would be coming from, but the markets are certainly trading like we might have a little inflation coming," added Gordon, founder of TradingAnalysis.com.