Bitcoin recovers from a trip to six-week lows as Fed Chair Jerome Powell gives strong “dovish” clues over where interest rates will head in September.
Market Update
Key points:
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Bitcoin returns to $116,000 after gaining over 2% in minutes thanks to “dovish” comments from Fed Chair Jerome Powell.
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Powell’s Jackson Hole speech cemented the odds of an interest-rate cut next month.
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Risk assets and crypto rose immediately, while US dollar strength fell.
Bitcoin () spiked to $116,000 on Friday as the US Federal Reserve hinted that it would cut interest rates.
Bitcoin price rebounds from 6-week lows on Fed
Data from and followed volatile BTC price action as Fed Chair Jerome Powell delivered a policy speech.
Powell took to the stage at the annual Jackson Hole economic symposium — traditionally an opportunity to hint at upcoming policy moves.
The current situation with inflation and the labor market, he said, “may warrant adjusting” the Fed’s monetary policy stance.
Markets immediately reacted, with crypto and risk assets jumping while US dollar strength tumbled.
BTC/USD gained over 3%, helping lift the pair from local lows of $111,658 — its lowest level since July 10.
“Good bounce from the range low sweep on the back of a dovish Powell. Going to remain volatile for the rest of the day,” popular trader Daan Crypto Trades in a reaction on X.
Commentator TheKingfisher noted that the price had taken bid liquidity during the trip to the lows.
High leverage liquidation map from this morning (5:40 ago) cleared 🎯
— TheKingfisher (@kingfisher_btc)
“Bitcoin is showing bullish divergence (again) with oversold RSI on the 4-hour… and 6-hour. Maybe the 12-hour. Maybe the daily. All at key $112K support,” trader, analyst and podcast host Scott Melker, known as the “Wolf of All Streets,” just before Powell began speaking.
“Anything can happen, but always interesting when very strong signals appear in alignment with news events.”
Powell “setting the stage” for new rate cut
Considering the implications of Powell’s choice of words, market participants were skewed in favor of the Fed cutting interest rates at its upcoming meeting in September.
Related:
“It appears Fed Chair Powell is setting the stage for a September rate cut,” trading resource The Kobeissi Letter .
Kobeissi suggested that the Fed would cut by 25 basis points, a view echoed by market expectations from CME Group’s .
As , uncertainty had previously reigned over the September outcome as Powell stuck by his hawkish tone amid rising inflationary cues and uncertainty over US trade tariffs.
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