Today is the most critical day for determining the market trends in the crypto space for the second half of the year (Detailed Analysis)
1. Reasons
Timeframe: There is a high probability that the Federal Reserve will announce its first interest rate cut this year in September (75%), and today's “Jackson Hole Meeting” is Powell's last major public statement before the rate cut.
Convention: The Federal Reserve usually releases signals in advance through speeches to avoid sudden market fluctuations. Therefore, Powell's remarks tonight will serve as a “weather vane” for the market.
2. The Market Has Already Responded
U.S. Stocks: Since Tuesday, U.S. stocks have shown a “preemptive decline,” reducing positions and deleveraging, which essentially gives Powell some breathing room.
Crypto Market: The fundamentals have not changed, but the market has followed U.S. stocks downwards, spreading panic.
Actions of Market Makers: On-chain data shows that stablecoin issuance has increased by over 2 billion U in the past two days, which is a typical signal of “accumulating at low levels,” indicating that major funds have not exited the market but are waiting for policy announcements.
3. Powell's Situation and Possible Statements
In the past six months, Trump has publicly insulted Powell over 30 times, putting tremendous pressure on him.
If he “doves” tonight, the market will immediately rebound.
If he “plays Tai Chi” (gives vague statements), the market will perceive it as hawkish, and the short-term pressure will continue.
In extreme cases (directly hinting at interest rate hikes, probability <5%), this will trigger a sharp decline in both U.S. stocks and the crypto market.
4. The Real Factors Considered by the Federal Reserve
Employment + Inflation indicators.
Overheated employment → High risk of rate cuts, possibly increasing inflation.
Decreasing inflation, core PCE close to 2% → Room for rate cuts.
Practical Game: While economic data is indeed important, U.S. monetary policy is currently deeply entrenched in political struggles:
Trump vs. Powell: On the surface, it's a personal feud, but fundamentally it's a struggle of interest groups behind the scenes.
Among the 7 members of the Federal Reserve Board, 3 are already leaning towards Trump, and the dovish faction is gradually gaining an advantage in the FOMC's 12-vote structure.
5. Conclusion
If he doves tonight: Market sentiment will immediately warm up, with speculative capital pouring in, leading U.S. stocks and the crypto market to take off simultaneously.
If he hikes tonight: Short-term market pressure will exist, but given the high probability of two rate cuts this year, a correction could actually present a good opportunity for medium-term entry.
