Bitcoin (BTC) and Ethereum (ETH) prices are experiencing slight fluctuations just hours before Federal Reserve Chair Jerome Powell's speech scheduled for this evening at the annual conference in Jackson Hole.

According to the latest data, the price of Bitcoin has dipped to around $112,873, a decrease of 0.5% over 24 hours, while Ethereum has fallen to about $4,316 with a loss of 0.6% within one hour. This performance reflects the prevailing state of anticipation among investors ahead of potential decisive signals regarding U.S. monetary policy directions.

Although markets are still betting on a rate cut in September, the recent high inflation reading has led some Federal Reserve members to question the timing of this step. Current odds indicate a 71.3% chance for a 25 basis point cut next month, compared to higher levels earlier.

Powell's speech – titled "Economic Outlook and Framework Assessment" – is viewed as the most important compass for upcoming policy decisions. If his tone leans toward easing, it could push Bitcoin to test the $130,000 level. Conversely, if he takes a more hawkish stance, it may enhance the cautious sentiment and push the price to test support at $105,000.

This comes as prominent central bank governors – including Christine Lagarde (President of the European Central Bank), Andrew Bailey (Governor of the Bank of England), and Kazuo Ueda (Governor of the Bank of Japan) – prepare to participate in a discussion session on labor market transformations on Sunday, an event that may carry additional messages for global markets.

Despite the Bitcoin and Ethereum ETF funds recording an outflow of funds last week, on-chain data indicates that long-term Bitcoin holders continue to increase their positions, with total holdings surpassing 15 million coins, coinciding with the network's strength reaching a record level of 930 EH/s.

Overall, Powell's speech in Jackson Hole may represent the most significant catalyst for short-term market movements, especially given the fragility of the U.S. labor market conditions, although the fundamental outlook for Bitcoin remains strong in the long term.

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