In a massive development for the crypto market, Fed Chair Jerome Powell suggested that they may have to make a rate cut at the September FOMC meeting during his Jackson Hole speech. This has led to a massive spike in the BTC price, with other crypto assets rising on the back of the news. Jerome
The post Breaking: Jerome Powell Signals Fed Rate Cut At Jackson Hole, BTC Price Spikes appeared first on CoinGape.
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Key takeaways
- ETH is trading above $4,300, up by less than 1% in the last 24 hours.
- Investors will focus on Powell’s speech at Jackson Hole later today.
Ether remains resilient despite bearish market conditions
The cryptocurrency market has been volatile since the start of the week, and more volatility is expected over the next few hours. Traders are bracing for potential volatility ahead of Federal Reserve (Fed) Chair Jerome Powell’s speech at the Jackson Hole Symposium.
Bitcoin continues to trade around $113k while Ether is trading above $4,300, up by less than 1% in the last 24 hours. Ether’s resilience can be attributed to JPMorgan’s recent report that revealed that spot ether exchange-traded funds (ETFs) pulled in $5.4 billion in July, matching bitcoin ETFs. On the other hand, Bitcoin funds have since seen modest outflows, while ether vehicles continue to draw capital.
According to the bank, the SEC approval of in-kind redemptions for ether ETFs is expected to lower costs, boost liquidity, and further strengthen Ether’s positioning against Bitcoin.
Ether could dip below $4,200 if Powell’s speech comes hawkish
The FOMC minutes released on Thursday revealed hawkish bias by the Federal Reserve, with analysts not expecting the apex bank to cut rates by next month. The market’s performance in the near term could be dictated by Powell’s speech later today.
The ETH/USD 4-hour chart is bearish and efficient as Ether has lost 7% of its value over the last seven days. The RSI of 51 shows that Ether is neutral, while the MACD lines suggest a bearish undertone.
At press time, ETH is trading at $4,314 per coin. If the daily candle closes above the $4,232 support, ETH could extend the recovery toward its next daily resistance at $4,488. An extended bullish run would allow it to aim for its yearly high at $4,788.
However, with the broader market still bleeding, Ether could face a correction if its daily support at $4,232 fails. This could extend ETH’s decline toward its next support level at $3,946.
Bitcoin, Ethereum, Dogecoin, Solana Slide Ahead Of Jerome Powell’s Jackson Hole Speech: Large Investors Buying The BTC Dip, Says Analytics Platform Benzinga
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Coinspeaker
Bitcoin ETFs Surge with $250M Inflows After Rate Cut Hints at Jackson Hole
The combined daily inflow of spot Bitcoin exchange-traded funds (ETFs) in the United States surpassed $252 million on Friday. This was the highest net inflow recorded by the funds in a single day since July 23.
While the inflow was remarkable, other metrics associated with the funds appear to reflect that encouraging comments from the Jackson Hole symposium may have lent a boost to risk assets, including Bitcoin (BTC).
Bitcoin ETFs See Record Daily Inflow
Not only was there an influx of capital into the funds. Trading volumes for all eleven ETFs also went above $3.12 billion, according to SoSo Value data. This means that the trading volumes for US-listed Bitcoin ETFs have now hit the highest level since July 19.
Of all the funds, BlackRock’s IBIT saw the most activity as well as the most inflow. Its trading activity topped $1.2 billion, while it saw a positive flow of $83 million at the end of the day.
Fidelity followed with its FBTC seeing $64 million in inflows, while Bitwise’s BITB also had an interesting day after receiving $42 million. Notably, Friday’s inflow was enough to help Bitwise cross the $2 billion asset under management (AUM) mark for the first time. Although not shocking, Grayscale’s GBTC continued its unimpressive run of form. It was the only product that saw negative flows after $35 million left it. That is, despite its mini Bitcoin fund BTC, seeing massive inflows of over $50 million the same day.
The Fed Effect
As earlier noted, Friday’s inflow is, without doubt, related to the signals coming from the Federal Reserve. That is, as it relates to potential monetary policy changes.
Fed chair Jerome Powell, while at the Jackson Hole symposium on Friday, noted that it is time for the agency to adjust its policies. This has been translated by many as meaning that the Fed is getting ready to loosen monetary policy. He said partly:
“The direction of travel is clear, and the timing and pace of rate cuts will depend on incoming data, the evolving outlook, and the balance of risks.”
As would be expected, Powell’s comments almost immediately sparked an industry-wide rally that saw BTC climb above $64,000. Therefore, it might be safe to say that this was what ultimately translated into the inflows recorded by the ETFs.
Looking ahead, though, the Fed’s next policy meeting is scheduled for September 17. So, crypto traders are fully optimistic that the Federal Reserve will deliver its first rate cut at that time.
The concept remains that tighter monetary policies typically weigh on risk appetite in financial markets. This means that it becomes extremely difficult for investors to access capital pools, making it less likely that they put their money into risky assets. On the other hand, lower rates tend to attract investors to these asset classes because they now have cheaper access to capital pools.
Bitcoin ETFs Surge with $250M Inflows After Rate Cut Hints at Jackson Hole
]]>Bitcoin, Ethereum, Dogecoin Flat Ahead Of Fed Chair Jerome Powell’s Jackson Hole Symposium Speech: Analyst Predicts King Crypto’s Rally Past $70K If It Breaches This Level Benzinga
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US Federal Reserve Chair Jerome Powell said softer labor markets are required to lower the inflation. He warned that the US central bank is prepared to raise interest rates further if they feel it to be appropriate.
Also Read: Terra (LUNA) And Terra Classic (LUNC) Impacted Amid Terra Money And Station Issues
Powell Speech Highlights Need To Restrict Monetary Policy
Powell revealed that the Fed staff intends to hold the interest rates at restrictive level until they are confident that inflation is moving sustainably towards the 2% target. He made the remarks at the Economic Policy Symposium also popularly called the Jackson Hole meeting hosted by the Federal Reserve Bank of Kansas City. Prior to the speech, traders were anticipating the Fed Chair’s comments on the long term economic scenario amid the ongoing macroeconomic uncertainty.
The Fed Chair explained that the central bank committee would proceed carefully on whether to hike the rates again. Currently, the target rate stands at 525 to 550 bps, while the next Federal Open Market Committee (FOMC) is scheduled for September 20, 2023. The CME FedWatch Tool currently suggests trader confidence of 78% on a rate hike pause in the upcoming meeting. Since the last year’s Jackson Hole meeting, the interest rates were hiked by a daunting 300 basis points.
Powell remarked that there needs to be some more progress on the non-housing services inflation, reiterating that the Fed will not move away from its inflation target. He stressed on the central bank’s priority to maintain price stability in the economy.
BTC Price Reacts ..
In the initial response to the speech, the Bitcoin price dropped slightly while the S&P 500 Index also saw a slight dip, before both of them recovering significantly. The Nasdaq Composite Index rose by 0.6%, whereas the Dow Jones Industrial Average showed a 0.3% rise.
Also Read: BTC Price Prediction: $25k Support Can Save Bulls, But There’s A Catch
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
Bitcoin, Ethereum, Dogecoin Slip Ahead Of Jerome Powell’s Jackson Hole Speech: Analyst Predicts ‘Grinding Benzinga
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After a recent bounce earlier this week on Wednesday, August 23, the Bitcoin (BTC) price has entered a sharp retracement and moved back once again closer to $26,000. While the sentiment around Bitcoin remains largely bearish, on-chain data provides some optimism to investors.
The Bitcoin supply at the exchanges has dropped to a 6-year low. Only a small portion, about 5.8%, of the total Bitcoin supply is currently held on exchanges. This marks the lowest level for the top cryptocurrency by market cap since December 17, 2017. Furthermore, there are consistent instances of significant whale transactions involving $BTC, averaging around 57.4K per week, reports Santiment.
As Exchange Reserves decrease during a market downturn, it suggests that investors are opting to hold onto their assets for potential future profits instead of selling. If this trend continues, it could lead to a substantial price increase for Bitcoin when favorable macroeconomic factors and a positive global crypto market sentiment return.
Another positive indicator is that Bitcoin whales have been accumulating recently after last week’s market crash. Since last week’s fall to $25,000, Bitcoin whales have accumulated over $300 million worth of Bitcoins so far.
#Bitcoin | Whales seem to be buying the #BTC dip. We’re seeing a spike in addresses holding 1,000+ $BTC. pic.twitter.com/TXec7s8a2q
— Ali (@ali_charts) August 24, 2023
Where’s Bitcoin Moving Next? All eyes on the Fed
On the technical charts, Bitcoin continues to show weakness as it has already dropped under the 200-day moving average. For now, the immediate support zone for Bitcoin stands at $25,200-$24,800. However, breaching this could see the BTC price fall further to $20,500.
All eyes are currently on the Fed’s Jackson Hole meeting later today on Friday. U.S. Federal Reserve Chair Jerome Powell will shed light on whether or not they would be ending the interest rate hike cycle.
On the other hand, the US regulatory action on crypto firms has further dampened market sentiments. Amid the SEC action, Bitstamp decided to discontinue the Ether staking facility for US customers from next month onwards.
The cryptocurrency market might face ongoing pressure from negative sentiment in the upcoming weeks or months until there is a clear regulatory and legislative framework that governs the cryptocurrency market.
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
Amid the backdrop of Jackson Hole, Wyoming, financial markets are poised for the Federal Reserve’s annual symposium. The central focus remains on inflation’s trajectory and its intricate relationship with interest rates. Powell’s approach has allegedly shifted from a stern resolve to a more nuanced stance. Last year’s unequivocal commitment to hitting the 2% inflation target has evolved. Powell now enters the stage believing that taming inflation need not come at the cost of substantial job losses.
Strategic Restraint and Inflation Realities
Julian Brigden, an authority from Macro Intelligence 2, offers insight into the Fed’s probable strategy. Powell’s speech may not introduce novel elements but instead reinforce the central bank’s cautious approach.
Fed Expected To Drill In ‘Higher For Longer’ In Jackson Hole
Fed Chair Powell’s Jackson Hole speech is unlikely to bring new elements to the US monetary policy outlook, says Julian Brigden, from Macro Intelligence 2. “They will keep holding out their powder because they don’t…
— *Walter Bloomberg (@DeItaone) August 24, 2023
Brigden suggests the Fed will avoid rate cuts to maintain current financial conditions. The subtle art lies in preserving a suspenseful air around potential rate hikes, aligning the Fed’s intentions with the market’s concept of “longer.”
Inflation, Employment, and Interest Rates
As the symposium unfolds, the spotlight falls on Powell’s speech, scrutinizing his approach to inflation dynamics. The critical question is whether the decline in inflation warrants a more measured or assertive interest rate approach.
Powell’s transformed outlook acknowledges the potential for taming inflation without inflicting severe job losses. This shift in stance reflects a more intricate understanding of the intricate dance between inflation, employment, and interest rates.
Powell’s words take center stage with the symposium, shaping expectations for the Federal Reserve’s future steps. The theater of fiscal policy continues its captivating performance. As financial stakeholders await Powell’s nuanced insights, the broader market anticipates a strategy that skillfully navigates the complexities of inflation while preserving economic vitality.
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
At a time when concerns of dedollarization are rampant, the Federal Reserve Bank of Kansas City is set to convene the annual Economic Policy Symposium, also called the Jackson Hole meeting, between August 24-26, 2023. Going by the history of US Fed events in the last two years, it is highly likely that Bitcoin price could react heavily during the much anticipated conference.
Also Read: BTC Price To Hit $148k After Bitcoin Halving: Pantera Capital
Focus On Global Economic Shifts
In the backdrop of the United States and other economies dealing with the effects of pandemic in 2021 and 2022, the focus of this year’s event will be on the theme “Structural Shifts in the Global Economy.” The geopolitical and economic effects of Russian invasion of Ukraine and the threat of the BRICS Group shifting from the US Dollar for international trade settlements have predominantly made much noise in recent times. The 2023 conference is said to explore the many significant, and potentially long lasting, developments affecting the global economy.
Jerome Powell Speech At Jackson Hole Meeting 2023
On August 25, 2023, US Federal Reserve Chair Jerome Powell will deliver his remarks at the conference. The Fed Chair’s speech will be made amid much anticipation in the context of the uncertainty surrounding the United States’s economic outlook. His comments on the inflation targets in the short term, the Fed’s path towards the 2% inflation target and the corresponding target rate decisions will be closely looked at by market participants.
Christine Lagarde, president of the European Central Bank, is also set to speak on the same day as the US Fed Chair. Meanwhile, Powell speech could likely have a volatile effect on the crypto market, which has in the last few weeks slowed down with dip in asset prices.
Also Read: Ripple Vs SEC: Key Executives Signal Trial Readiness for Q2 2024
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.