Bitcoin and Ether Rally Following Powell’s Jackson Hole Speech
The crypto market sentiment has shifted back to “Greed” after U.S. Federal Reserve Chair Jerome Powell hinted at the possibility of a rate cut in September, sparking a strong rally in Bitcoin (BTC) and Ether (ETH).
According to the Crypto Fear & Greed Index, the sentiment score climbed to 60 (Greed) on Saturday, a significant rise from Friday’s neutral reading of 50, and a sharp recovery from earlier in the week when it dipped into “Fear.” This surge in optimism followed Powell’s remarks at the Jackson Hole economic symposium, where he acknowledged that current inflation and labor market conditions “may warrant adjusting” the Fed’s monetary stance.
Bitcoin and Ether Surge to Multi-Year Highs
The crypto market responded immediately, with Bitcoin jumping 5% to $117,300, triggering the liquidation of $379.88 million in short positions. Meanwhile, Ether soared 11.5%, reclaiming its 2021 all-time high of $4,878, briefly touching $4,851, according to CoinMarketCap.
Axie Infinity co-founder Jeffrey “Jiho” Zirlin noted that Ether is the “most rate-sensitive aspect of crypto”, highlighting the impact of monetary policy on DeFi yields compared to traditional banking returns.
The CME FedWatch Tool shows a 75% probability of a rate cut during the September 17 meeting, reflecting strong market expectations. Analysts believe a dovish Fed stance increases liquidity, making risk-on assets like crypto more attractive.
The Kobeissi Letter commented, “It appears Fed Chair Powell is setting the stage for a September rate cut.” Historically, lower interest rates have supported bullish trends in crypto, as investors seek higher-yielding alternatives.
However, St. Louis Fed President Alberto Musalem urged caution, stating he needs more time before making a final decision: “I will be updating my outlook and balance of risks all the way up to two days before the meeting.”
With Bitcoin approaching record highs and Ethereum testing previous peaks, the market outlook remains bullish—provided the Fed delivers on rate cuts. If Powell confirms a monetary easing cycle, analysts expect strong upside momentum for major cryptocurrencies.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.