At the Jackson Hole meeting, Powell's dovish speech instantly ignited enthusiasm in the cryptocurrency market, with Bitcoin skyrocketing 3.15% within just one hour, breaking through the $116,000 mark. Major cryptocurrencies like Ethereum also did not lag behind, following closely, as the market displayed a long-awaited strong festive atmosphere.
The real catalyst for this wave of market action stems from Powell's clear indication of economic risks, which has led the market to firmly believe that the Federal Reserve will fully shift to a rate-cutting policy. Traders quickly reacted, with futures market data showing that the probability of a 25 basis point rate cut in September soared to over 70%. A rate cut by the Federal Reserve means looser market liquidity, creating a macro environment that directly benefits risk assets, with cryptocurrencies, as leading risk assets, becoming the focus of capital inflows.
From a technical perspective, Bitcoin successfully stabilizing above $116,000 is extremely critical. This price level was previously seen as an important resistance point, and a successful breakthrough indicates that bullish sentiment in the market continues to heat up, with a new upward trend likely to officially start. Ethereum also performed strongly, with institutional funds continuously increasing their holdings, providing solid support for the coin's price, and overall market sentiment continues to rise.
However, investors also need to remain cautious and rationally face risks. Although Powell's speech released clear positive signals, the Federal Reserve's monetary policy still heavily relies on subsequent economic data, where fluctuations in macro indicators like inflation levels and employment situations could impact policy direction. The cryptocurrency market itself is highly volatile, and even minor changes in policy direction in the short term could lead to significant price fluctuations.
From a long-term perspective, the Federal Reserve's policy shift has indeed created a favorable environment for the cryptocurrency market. A low-interest-rate era typically brings broad growth opportunities for risk assets, and under the backdrop of ample liquidity, the cryptocurrency market may continue to attract more traditional capital. The acceptance of institutional investors is continuously increasing, and ETF products are being launched one after another, all of which indicate a promising outlook for the cryptocurrency market.
In summary, Powell's statements have opened a new window for upward movement in the cryptocurrency market, but investors still need to closely monitor subsequent changes in policy, seizing opportunities while also preparing for risks.
