Daily News 19

Tag: Jackson Hole speech

  • Kaiko Data Reveals Bitcoin Volatility

    Kaiko Data Reveals Bitcoin Volatility

    Bitcoin Volatility Surges Amid Federal Reserve Policy Uncertainty

    Bitcoin’s recent volatility has surged, reflecting renewed uncertainty surrounding Federal Reserve policy decisions. According to data from KaikoData, the 30-day rolling volatility for Bitcoin spiked following the August Jackson Hole speech, eased temporarily, and then climbed again into September. This pattern suggests traders should closely monitor future Fed communications for clearer guidance on interest rates, which directly impacts market sentiment across digital asset markets.

    Mixed Signals Across Crypto Markets

    The broader cryptocurrency market indicates mixed signals, with various assets experiencing different momentum shifts. As Bitcoin grapples with climbing volatility, reduced forward guidance from the Federal Reserve adds an element of unpredictability. This uncertainty is particularly relevant for traders engaged in the derivatives market, where open interest and funding rates serve as crucial indicators of market sentiment. The potential for liquidation cascades also rises as traders navigate this volatile landscape.

    Key Data Points

    • Bitcoin’s 30-day rolling volatility spiked after the August Jackson Hole speech
    • Volatility eased before climbing again into September
    • Reduced Fed forward guidance leaves markets uncertain about interest rate trajectory
    • Traders are advised to watch for clearer Fed signals moving forward

    Market Conditions and Trading Activity

    Bitcoin’s price remains relatively unchanged as volatility increases, with no significant trading volume reported in the past 24 hours. The current market environment showcases hesitancy among traders as they respond to the Federal Reserve’s policy indications. This volatility trend may lead to increased caution in the market as traders reassess their positions amid the shifting landscape.

    As the leading cryptocurrency, Bitcoin’s price volatility and market influence make it particularly sensitive to macroeconomic policy shifts. The Federal Reserve’s policy decisions significantly affect financial markets, including cryptocurrencies, given their impact on interest rates and overall economic conditions.

    Levels to Watch

    Traders are monitoring potential shifts in Bitcoin’s volatility based on upcoming Fed announcements. Key levels to watch will be the reactions to new guidance, which could either stabilize or exacerbate current volatility trends. Risks remain high, especially if traders encounter sudden market movements that could lead to significant liquidations.

    This article is for informational purposes only and does not constitute financial advice.

  • Bitcoin Faces Critical Two Weeks as Wintermute Reveals Key Price Levels: “The Next Two Weeks Are Very Critical,” and “Below This Is…

    Bitcoin Faces Critical Two Weeks as Wintermute Reveals Key Price Levels: “The Next Two Weeks Are Very Critical,” and “Below This Is…

    Bitcoin rose above $81,000 last week before falling back to approximately $78,000 after Federal Reserve Chairman Kevin Warsh delivered a hawkish speech in Jackson Hole. With BTC trading near $78,000 in recent days, cryptocurrency market maker Wintermute has outlined its latest expectations for Bitcoin.

    Bitcoin Could Trade Between $75,000 and $82,000 Before the Fed Meeting

    Wintermute expects Bitcoin to remain between $75,000 and $82,000 until the Federal Open Market Committee (FOMC) meeting scheduled for September 15–16.

    According to Wintermute’s latest market analysis, Warsh’s speech at the Jackson Hole Annual Meeting increased expectations of a September rate hike to 64.4%. The company expects the September FOMC meeting to become a major catalyst for risk assets, particularly cryptocurrencies.

    Wintermute said market expectations for interest rates will be a decisive factor in Bitcoin’s next move. Economic data due during the first two weeks of September could significantly alter those expectations ahead of the FOMC meeting.

    US nonfarm payrolls data, scheduled for release on September 4, will be closely watched for its potential impact on interest-rate expectations and the direction of BTC.

    $82,000 Resistance Remains Key for Bitcoin

    Wintermute also noted that Bitcoin has faced repeated selling pressure near $82,000 following its recent rally. The company identified the following key levels:

    “$82,000: As a significant resistance$75,000: As the first significant support$72,000: As a critical support”

    Wintermute warned that a weekly Bitcoin close below $72,000 could alter the current market outlook. Below that level, the company sees no clearly defined support zone, potentially increasing the risk of further declines.

    In the current market environment, Wintermute considers a pullback toward $75,000 a healthier short-term move for Bitcoin. Such a decline could clear leveraged positions before the market makes another attempt to move higher.

    Based on this outlook, Wintermute expects Bitcoin to consolidate within the $75,000–$82,000 range until the September FOMC meeting.

    This is not investment advice.

  • Bitcoin (BTC) at a Critical Junction After Rally: Analysts Say Further Gains Depend on Two Events

    Bitcoin (BTC) at a Critical Junction After Rally: Analysts Say Further Gains Depend on Two Events

    Bitcoin surged 24% in August, marking its strongest monthly gain since November 2024. After the sharp rally, the cryptocurrency stabilized near $78,000 as high oil prices and rising U.S. Treasury yields limited further upside.

    At the same time, expectations for a September interest rate hike increased significantly following Federal Reserve Chairman Kevin Warsh’s speech in Jackson Hole. Despite the more hawkish outlook from the Fed, analysts say Bitcoin continues to hold key support levels.

    Bitcoin Holds Critical Support at $77,100

    According to Bitfinex analysts, Bitcoin is holding its critical support level at $77,100 despite signals that the Federal Reserve may pursue a more hawkish monetary policy.

    Bitfinex’s latest Alpha report said Bitcoin experienced a sharp pullback last week after climbing to $81,500 following Kevin Warsh’s remarks at Jackson Hole. However, Bitcoin’s ability to remain above $77,100 suggests that the broader uptrend has not yet been broken.

    Spot Bitcoin Buying Supports the Rally

    Bitfinex analysts said Bitcoin’s August surge was not driven solely by leveraged trading. Actual purchases in the spot market also contributed to the cryptocurrency’s rise.

    U.S. spot Bitcoin ETFs recorded total net inflows of $924.5 million during the week of August 24-28. Bitfinex said liquidity concentrated in ETFs and stablecoins is supporting the Bitcoin and broader crypto market uptrend, although high inflation and expectations of future interest rate hikes could restrict additional gains.

    U.S. employment data due on September 4 and inflation data scheduled for September 11 are expected to be important for market expectations surrounding the Federal Reserve’s September interest rate decision.

    Can Bitcoin Hold Above $80,000?

    Bitcoin fell below $80,000 after Kevin Warsh’s hawkish speech at Jackson Hole but has continued to hold the $77,100 support level.

    Questions remain over whether Bitcoin can sustain a move above $80,000. Bitfinex points to strong spot Bitcoin demand and approximately $925 million in net inflows into spot Bitcoin ETFs as factors supporting the market. However, some analysts remain cautious about the durability of the rally.

    Greeks.live analyst Adam said ETFs had recorded large inflows, but the strong inflow streak ended with a $202 million outflow on August 28. The analyst warned that continued ETF outflows, and the possibility that they could become permanent, may make it more difficult for Bitcoin to remain above $80,000.

    The analyst also discussed Strategy’s decision to resume Bitcoin purchases after a long pause. According to the analyst, Strategy’s purchases could support the price in the short term but may not be sufficient on their own to alter the long-term trend.

    Macroeconomic Risks Remain

    The analyst said the Federal Reserve’s hawkish stance and broader macroeconomic uncertainty remain among the main risks facing Bitcoin, echoing concerns raised by Bitfinex.

    These factors are putting additional pressure on investor confidence and the Bitcoin price. The analyst believes it is too early to describe the market as a new strong bull trend without a sustained move above $80,000. ETF flows and Federal Reserve policy are likely to play a decisive role in determining Bitcoin’s short-term direction.

    This is not investment advice.

  • Bitcoin Needs Sustained ETF Demand as Fed Rate Hike Risks Grow, Analysts Say

    Bitcoin Needs Sustained ETF Demand as Fed Rate Hike Risks Grow, Analysts Say

    Bitcoin’s August rally is facing a tougher test as investors assess whether sustained spot exchange-traded fund (ETF) demand can offset rising expectations of a September Federal Reserve rate hike.

    Bitfinex analysts said in an Aug. 31 market report shared with crypto.news that Bitcoin’s latest advance has increasingly been driven by spot buying rather than excessive leverage. That could leave the market better positioned to absorb selling even as U.S. monetary conditions become less supportive.

    Bitcoin ($BTC) was trading near $78,700 at the time of writing, down about 0.4% over 24 hours, according to crypto.news data. The cryptocurrency briefly climbed above $81,000 last week before falling to $76,857 after Federal Reserve Chair Kevin Warsh used his Jackson Hole address to signal that interest rates may still need to rise.

    The decline interrupted a rally that lifted Bitcoin from below $65,000 in mid-August to above $80,000. As previously reported by crypto.news, Bitcoin gained about 24% during the preceding week as Treasury buybacks, ETF demand and forced short covering fueled the recovery.

    Bitcoin ETF demand faces a tougher test

    Bitfinex analysts said the derivatives market has not displayed the rapid leverage buildup typically associated with an overheated rally. Bitcoin open interest stood at $55.6 billion, more than 20% above its level at the start of August, but the increase has been gradual and basis levels have remained relatively low.

    “We are in a market driven by spot buying and, notwithstanding large short liquidations, open interest has only gradually increased, while basis has remained relatively low and at healthy levels historically,” the analysts said.

    According to the report, Bitcoin holding the $77,100 level, which Bitfinex identified as important lower-timeframe support, alongside continued spot buying would suggest that market conditions remain relatively balanced.

    ETF flows offer another indication of whether that demand can continue. U.S. spot Bitcoin ETFs absorbed about $3.04 billion during nine consecutive positive sessions from Aug. 17 through Aug. 27, according to Bitfinex. Friday marked the first net outflow in 10 sessions, with investors withdrawing $201.9 million as Bitcoin reversed from above $81,000.

    Despite those redemptions, the funds recorded $924.5 million in net inflows for the week. Inflows over the preceding two weeks totaled about $2.8 billion.

    BlackRock’s IBIT accounted for just $33.4 million of Friday’s withdrawals after attracting roughly $2.3 billion during the previous nine sessions. ARKB and BITB recorded a combined $164.6 million in outflows.

    Institutional demand has also absorbed Bitcoin sold by larger holders, Bitfinex said. Whale addresses holding between 1,000 and 10,000 $BTC reduced their balances by 50,500 $BTC since the end of June, while institutional custodial holdings associated with exchanges and ETF platforms increased by 59,100 $BTC.

    During the latest August advance, custodial balances rose by 31,500 $BTC, closely tracking ETF inflows, according to the analysts.

    “While whales took profits during the rally, institutional demand absorbed that supply, indicating that assets moving into these regulated vehicles may be less prone to sudden liquidation on the basis of short-term macroeconomic news.”

    $80K–$83K could test the strength of real demand

    Jeff Ko, chief analyst at CoinEx, told crypto.news that part of Bitcoin’s August rally resulted from Treasury buybacks pushing yields and the dollar lower while traders held large short positions.

    Ko said the mechanical portion of the resulting short squeeze has now “largely played out,” making spot demand increasingly important around $80,000.

    “Treasury buybacks pushed yields and the dollar lower, and that impulse collided with crowded short positioning to produce the squeeze,” Ko said. “What matters from here is whether spot buyers keep absorbing supply around $80K.”

    The Treasury catalyst had already produced a sharp market response earlier in August. On Aug. 19, the department announced that it would at least double the maximum size of liquidity-support buybacks for 10-to-20-year and 20-to-30-year nominal coupon securities from $2 billion to at least $4 billion per operation from Sept. 9 through Nov. 4.

    The change helped compress long-term yields as Bitcoin surged. An Aug. 20 analysis of the buybacks found that $BTC rose 8.2% from an intraday low of $64,100 to $69,500 within 12 hours of the Treasury announcement, while $1.44 billion in short positions were liquidated.

    Ko views the $80,000–$83,000 range as more than a technical resistance zone. The area could reveal whether new investment can replace the buying pressure previously generated by forced short covering.

    “It is a major supply zone, and the point at which the rally stops being a short squeeze and becomes a test of real capital allocation.”

    Ether could provide another signal of broader cryptocurrency risk appetite. Ko said ETH traded near $2,490 heading into Jackson Hole but subsequently lagged Bitcoin in price performance. If Treasury yields and the dollar remain elevated while Ether begins outperforming Bitcoin in both price and investment flows, he would view that as evidence of stronger crypto demand.

    Bitfinex also identified Ether ETFs as a potential demand gauge. U.S. spot Ether products attracted $815.7 million last week, extending their positive streak to 10 sessions, according to the firm. Nearly 12.3% of cumulative Ether ETF inflows since launch arrived during August, while demand adjusted for the relative size of the assets was roughly four times stronger than Bitcoin ETF demand during the past week.

    Fed rate hike risk threatens Bitcoin’s liquidity support

    Bitcoin is now facing pressure from a less favorable interest-rate outlook. Warsh’s Jackson Hole remarks lifted the market-implied probability of a September rate increase to about 57%, according to Bitfinex.

    Ko said CME-implied odds rose from 39.9% on Aug. 21 to 57% following the speech. The two-year Treasury yield moved to around 4.31%, while the dollar returned toward a two-week high.

    Bitfinex analysts said persistent inflation remains a key obstacle to easier monetary policy. Headline Personal Consumption Expenditures inflation stood at 3.7%, with core inflation at 3.3%, while private domestic demand expanded at a 4.2% annualized pace during the second quarter.

    Jeff Mei, chief operating officer of BTSE, told crypto.news that Warsh’s speech raised the hurdle for Bitcoin because higher interest rates could reduce the liquidity available to cryptocurrency assets.

    “For a sustained rally, we need a few things to happen. First, ETF demand has to stay strong across all ETF products, and not just BlackRock’s IBIT ETF. Second, we need better inflation data for the Fed to back off and keep rates steady.”

    Mei also warned that the boost from Treasury buybacks could fade quickly. Earlier in August, Bitcoin broke above $76,000 as ETF inflows accelerated alongside improving U.S. liquidity conditions. Spot Bitcoin ETFs attracted $606 million on Aug. 20 alone, extending the institutional demand that accompanied the recovery from mid-August lows.

    U.S. economic data could shape Bitcoin’s next move

    Market attention is turning to a series of U.S. economic releases that could change interest-rate expectations before the Federal Reserve’s September meeting.

    Ko identified Friday’s August payroll report as the most important immediate event and the final jobs report before the FOMC decision. July payrolls fell by 23,000 compared with an 80,000 consensus estimate, while May and June payrolls were revised lower by a combined 103,000 jobs, according to figures cited by Ko. The unemployment rate currently stands at 4.1%.

    Before the payrolls report, ISM Manufacturing and JOLTS data are due Tuesday. ADP employment figures and the Federal Reserve’s Beige Book are scheduled for Wednesday, followed by ISM Services data on Thursday. Bitfinex analysts also identified the August labor-market and inflation reports as the next major tests for rate expectations.

    The August inflation report is scheduled for Sept. 11, placing another important data release immediately before the Sept. 15–16 FOMC meeting.

    Ko also pointed to the CLARITY Act as a crypto-specific U.S. catalyst, with a Senate procedural vote currently scheduled for Sept. 15. He considers the vote one of the largest asset-specific events on the September calendar, while the Federal Reserve meeting will determine the monetary backdrop for Bitcoin and other risk assets.

    For Bitcoin’s price, Mei sees $87,000 as the next level that would materially strengthen the bullish case after the cryptocurrency clears nearer resistance zones.

    “If we break the $87k mark and hold, $100K becomes the real target, and we could be looking at a bull market.”

  • Fedwatch Turns Hawkish as Odds of a September Rate Increase Reach 57%

    Fedwatch Turns Hawkish as Odds of a September Rate Increase Reach 57%

    The focus has shifted to the Federal Reserve’s September 16 federal funds rate decision. CME’s FedWatch Tool, which converts federal funds futures trading into implied policy probabilities, currently gives a 57% chance of a 25-basis-point rate hike that would lift the target range to 3.75%-4%. The probability of holding rates at the current 3.5%-3.75% range stands at 43%. With uncertainty elevated, forecasts for the next Federal Open Market Committee decision remain highly divided.

    September Fed Rate Hike Bets Rise Sharply

    The shift is even more striking compared with trader expectations just one week earlier. CME data showed that the probability of a rate hike was only 39.9% on Aug. 21. By Aug. 28, following the Jackson Hole speech, that figure had climbed to 57%, while bets on a September rate cut had almost disappeared.

    Prediction markets have not fully embraced the hawkish outlook. As of this weekend, Polymarket traders assigned a 52% probability to the Fed holding rates and 48% to a 25-basis-point hike. More than $66.6 million has changed hands on the wager, while the once-common rate-cut position now carries odds of just 1%.

    Traders on the prediction marketplace Kalshi are seeing similarly close odds. Its September Fed market, with more than $23.8 million in volume, puts the probability of no change at 52%, compared with 48% for a quarter-point hike.

    Another Kalshi betting contract gives the Fed a 67% chance of raising the federal funds rate at some point before 2027.

    Warsh Highlights Persistent Inflation Risks

    The market probabilities shifted significantly after Warsh’s keynote at the Jackson Hole Economic Policy Symposium. He avoided promising a September rate hike but repeatedly emphasized persistent inflation and the Federal Reserve’s responsibility to restore price stability.

    “There should be no misunderstanding: The Fed’s price-stability objective of 2 percent, as measured by the personal consumption expenditures (PCE) price index, is a firm, fixed target,” Warsh stressed.

    He also made clear that short-term interest rates remain the Fed’s primary tool for achieving that objective.

    The inflation figures Warsh cited help explain why traders interpreted his remarks as hawkish. The Fed’s preferred 12-month PCE inflation measure is running at 3.7%, while the six-month reading is higher at 4.1%. Neither figure is close to the central bank’s fixed 2% target, although some Fed critics believe that level will never be reached again.

    Warsh also described an economy that gives policymakers little reason to fear the effects of higher interest rates. Business investment is rising rapidly, particularly in the artificial intelligence (AI) sector. S&P 500 profits have increased more than 20% over the past year, while real consumer spending has grown more than 2% over four quarters. Unemployment remains at 4.1%.

    Markets Face a Close September Fed Decision

    That combination of persistent inflation and solid economic growth creates a difficult environment for federal funds rate doves. Higher rates can cool demand and inflation, while continued growth and employment give policymakers more room to tighten monetary policy without immediately damaging the labor market.

    Warsh still declined to commit to a rate hike, saying:

    “I stand here today committed to a discipline, not to a decision.”

    The message was deliberate: Markets can speculate about September, but the Federal Reserve does not intend to provide traders with an answer weeks before the meeting. For investors, the decision has become a genuine coin toss, with substantial money positioned on both outcomes. CME futures currently favor a hike, while Polymarket and Kalshi narrowly lean toward a rate hold.

    Inflation and labor-market reports will now carry even greater weight, and either could shift the balance before Fed officials meet in mid-September.

    Source: cryptonews.net

  • Bitcoin Drops After Warsh Speech as Rate-Hike Odds Reach 57% — Can BTC Reclaim $80K?

    Bitcoin Drops After Warsh Speech as Rate-Hike Odds Reach 57% — Can BTC Reclaim $80K?

    Bitcoin price fell 3% to $77,000 after Federal Reserve Chair Kevin Warsh delivered a hawkish speech at the Jackson Hole event, signalling that the central bank may not be finished fighting inflation despite recent macroeconomic data.

    We must be confident that underlying inflation is moving to our objective, clearly and at sufficient speed. Otherwise, we have work to do.

    Discussing the latest summer inflation data, Warsh added:

    While this summer’s PCE and CPI readings were better than expected, they do not tell me that underlying trends have meaningfully improved.

    Why did Bitcoin fall below $80,000?

    U.S. equities and cryptocurrency markets interpreted Warsh’s comments as hawkish. The tech-heavy Nasdaq fell 0.52%, while the S&P 500 declined 0.25%. Crypto markets followed, with Bitcoin leading the downturn with a 3% drop.

    Source: $BTC/USDT, TradingView

    Bitcoin had rallied 30% in the second half of August, supported by the Treasury’s planned $1 trillion intervention to curb rising bond yields. The upswing also helped BTC reclaim its crucial 200-day moving average.

    However, the rally has stalled below $80,000, delaying Bitcoin’s attempt to reclaim the 50-week moving average at $81,800 and officially mark the end of the BTC bear-market cycle.

    Can Bitcoin rally despite September Fed rate hike fears?

    Inflation directly influences Federal Reserve interest-rate policy and risk sentiment across financial markets. Following Warsh’s speech, interest-rate traders raised the probability of a September Fed rate hike to 57%, a 20% increase from the previous week. The repricing reinforced renewed fears of another rate hike.

    Source: CME FedWatch

    Bitcoin options traders, including sophisticated professionals and institutional investors, also moved to increase downside protection.

    This was reflected in the BTC 25 Delta Skew, which rose from -10% to nearly 5%, representing a 15% increase and signalling renewed demand for downside hedging.

    During Bitcoin’s explosive rally last week, the metric fell below 0% for the first time this year. That indicated traders were reducing their downside hedges as many analysts expected the rally, supported by the so-called debasement trade, to continue amid concerns over U.S. fiscal debt and turmoil in the bond market.

    Source: Velo

    The metric’s weekend spike now suggests that Warsh has forced Bitcoin bulls to reassess their strategy.

    Analyst Luke Gromen, however, believes the bond-market crisis will overshadow Federal Reserve rate decisions in the short term.

    It remains a variant perception that both Fed hikes or cuts will cause the long end to rise…even as long bond yields are now up on Warsh’s ‘hawkish’ speech today.

    If fears of a Fed rate hike intensify and weigh on market sentiment, Bitcoin’s price could retrace toward its 200-day moving average at $69,300.

    However, if the debasement-trade narrative continues, the $80,000 level could become support for the next leg of the uptrend.

    Bitcoin price outlook

    Bitcoin fell 3% to $77,000 after Kevin Warsh’s hawkish Jackson Hole speech. The Nasdaq declined 0.52%, while the S&P 500 fell 0.25%. Meanwhile, the probability of a September Fed rate hike increased to 57%.

  • Why Bitcoin Crashed After Warsh’s Jackson Hole Speech—and What Happens Next

    Why Bitcoin Crashed After Warsh’s Jackson Hole Speech—and What Happens Next

    Bitcoin’s recovery from below $65,000 to above $81,000 has encountered its first major macroeconomic setback after Federal Reserve Chair Kevin Warsh delivered a hawkish message at Jackson Hole on Friday. The key question now is whether the prospect of higher interest rates and rising U.S. Treasury yields could undermine the cryptocurrency market’s sharp rebound.

    Bitcoin ($BTC) held relatively steady during Warsh’s speech, but fell by $3,000 within hours of its conclusion, dropping below $77,000 for the first time in nearly a week. The sell-off spread across financial markets, weighing on stocks, precious metals and other risk-sensitive assets.

    Why Warsh’s Jackson Hole Speech Hurt Bitcoin

    Warsh did not explicitly say that the Federal Reserve is seriously considering raising interest rates, but his message was clear. Inflation remains elevated, the U.S. economy remains strong, and the central bank cannot simply declare victory. The Fed’s preferred personal consumption expenditures (PCE) inflation gauge is currently at 3.7% year over year, while its six-month annualized rate is even higher at 4.1%. Both measures remain well above the Fed’s target.

    Warsh emphasized that the Fed’s 2% inflation objective is “firm and fixed” and argued that price stability will not restore itself without further action from the central bank.

    He also played down some of the summer’s more encouraging inflation data, including the June figures, saying they had not convinced him or his colleagues that the underlying trend had improved substantially. Until the Fed can reassure markets that inflation is moving toward 2% “clearly and at sufficient speed,” policymakers will continue to “have work to do,” he added.

    Rate-Hike Expectations Rise as Bitcoin Falls

    Before Warsh’s speech, traders had assigned a one-third chance to an interest-rate increase in September. Those odds moved toward 60% after the speech, based on market pricing cited by Reuters. U.S. Treasury yields climbed again, while the dollar strengthened sharply after weakening the previous week.

    That is almost the opposite of the macroeconomic backdrop that helped Bitcoin surge 10 days earlier. The shift may explain why BTC fell from a recent peak above $80,000 to below $77,000 within hours, pulling most altcoins lower as well.

    Warsh also highlighted business investment growth of roughly 9% annually and a 20% rise in the S&P 500. Unemployment remained around 4%, while credit conditions were relatively easy. In practical terms, the economy is not currently giving the central bank an obvious reason to accept inflation above its target.

    Higher expected policy rates generally push Treasury yields higher, increasing the returns investors can earn from assets viewed as considerably safer. A more hawkish Federal Reserve also tends to support the U.S. dollar and tighten broader financial conditions. Historically, that combination has been unfavorable for Bitcoin and more speculative altcoins.

    Treasury Support Conflicts With the Fed’s Inflation Fight

    Treasury Secretary Scott Bessent’s recent intervention in the bond market helped drive long-term yields lower, at least temporarily, and contributed to Bitcoin’s major rally. However, Warsh reminded investors that the Federal Reserve has a different mandate.

    The Treasury may want to reduce borrowing costs and improve market liquidity, but the central bank must continue addressing inflation that remains above its target.

    As a result, markets remain caught between two powerful forces: Treasury efforts to support financial conditions and a Federal Reserve that may need to keep monetary policy tighter for longer than investors had expected.

    Source: cryptonews.net

  • Kevin Warsh’s Jackson Hole Speech Prompts Markets to Reassess Fed Rate Outlook

    Kevin Warsh’s Jackson Hole Speech Prompts Markets to Reassess Fed Rate Outlook

    Federal Reserve Chair Kevin Warsh used his first Jackson Hole speech to outline his approach to monetary policy, inflation control, economic conditions, financial markets and the growing role of artificial intelligence in the economy.

    Markets reacted quickly, with investors adjusting expectations for the Federal Reserve’s next policy decisions. Treasury yields moved higher as traders increased bets that the central bank could keep interest rates elevated or consider additional increases if inflation fails to improve further.

    🇺🇸 Kevin Warsh just delivered his first ever Jackson Hole speech as Fed Chair, and the tone was hawkish1. Inflation data doesn’t show meaningful improvement, 2% target remains firm and fixed2. Fed has more work to do unless underlying inflation moves toward target with speed…
    — Bull Theory (@BullTheoryio) August 28, 2026

    The post from Bull Theory on X described Warsh’s speech as hawkish and highlighted his comments on inflation, economic activity, artificial intelligence investment and monetary policy. The discussion reflected market attention on Warsh’s first major public address as Fed chair.

    Warsh’s message centered on the need for clearer evidence that inflation is moving steadily toward the Federal Reserve’s 2% goal before policymakers change direction.

    Inflation Remains the Federal Reserve’s Main Focus

    Warsh said recent inflation data has not improved enough for the Federal Reserve to become comfortable with current price trends. He reiterated that the central bank’s 2% inflation target remains unchanged.

    The Fed chair said policymakers must continue monitoring underlying inflation measures. He added that more work would be necessary if inflation does not move toward the target at a faster pace.

    Investors viewed the remarks as a signal that the Federal Reserve is not ready to shift toward easier monetary policy. Market participants had been watching Jackson Hole for indications that the Fed might become more supportive of interest-rate cuts.

    Instead, Warsh maintained a firm position on inflation control. His comments increased attention on upcoming economic releases, including inflation reports and employment data.

    Short-term Treasury markets reflected the change in expectations. The two-year Treasury yield, which is particularly sensitive to expectations for Federal Reserve policy, moved higher after the speech.

    Strong US Economy Gives the Fed More Policy Space

    Warsh also discussed the condition of the US economy. He said consumer spending remained healthy and business investment continued to expand.

    The Fed chair pointed to strong economic activity as evidence that higher interest rates have not caused a major slowdown. He also noted that unemployment remains low.

    Warsh said business investment had increased at a strong pace, with spending on artificial intelligence infrastructure contributing to recent growth. He said companies are investing heavily in new technology, although the timing of productivity gains remains uncertain.

    The comments gave investors another factor to consider when assessing future monetary policy. Strong economic activity could allow the Federal Reserve to maintain tighter financial conditions for longer if inflation remains above target.

    Markets had been watching whether economic weakness would force the central bank to consider faster rate cuts. Warsh’s remarks provided a different signal by emphasizing continued economic strength.

    Treasury Yields Rise as Markets Reprice Interest Rates

    The initial market response centered on interest-rate expectations. Treasury yields rose after Warsh indicated that additional measures may be needed if inflation does not improve.

    The increase in short-term yields showed that traders were changing their expectations for upcoming Federal Reserve meetings and factoring in a greater risk of tighter policy.

    The US dollar also attracted attention after the speech as markets assessed the prospect of higher interest rates. A stronger interest-rate outlook can increase demand for dollar-denominated assets.

    Equity markets were mixed as investors evaluated the effect of higher borrowing costs on companies. Technology stocks remained in focus because of their role in artificial intelligence investment and their future earnings outlook.

    Warsh did not provide specific guidance on the next rate decision. Instead, he indicated that future action would depend on economic data.

    The approach marked a shift away from detailed forward guidance. Warsh has previously supported a Federal Reserve that communicates less about future decisions and places greater emphasis on incoming economic information.

    Artificial Intelligence Investment Enters the Fed’s Policy Discussion

    Artificial intelligence was another major topic in Warsh’s Jackson Hole address. The Fed chair discussed how AI investment could influence productivity and economic growth.

    Warsh said companies are spending heavily on AI-related infrastructure. However, he questioned how quickly those investments would translate into broader productivity gains.

    The discussion showed that the Federal Reserve is monitoring technology trends as part of its economic assessment. AI development could affect employment, business investment and future growth rates.

    The comments gave financial markets another theme to consider alongside inflation and interest rates. As the Fed maintains a cautious policy stance, investors are watching whether AI investment can help increase corporate profits and productivity.

    Warsh’s priorities became clearer in his first Jackson Hole speech: keeping inflation on a steady path, relying on economic data and avoiding hasty decisions on monetary policy.

    Traders turned to rate futures and the Treasury market’s higher yields to assess short-term expectations and monitor the Federal Reserve’s next moves.

    Upcoming inflation and employment data, along with comments from other Fed officials, will shape the market’s next response.

  • Bitcoin and Gold Plunge as Kevin Warsh Signals Tighter Federal Reserve Policy

    Bitcoin and Gold Plunge as Kevin Warsh Signals Tighter Federal Reserve Policy

    Investors turned cautious on August 28 as the U.S. dollar strengthened and markets assessed more hawkish comments from Federal Reserve Chair Kevin Warsh during his first speech as Fed chair at Jackson Hole, Wyoming.

    Bitcoin dropped below $79,000, while gold and silver also suffered steep losses. The sell-off reportedly erased approximately $670 billion in market value in just seven minutes.

    The common factor was a stronger dollar and rising expectations that the Federal Reserve may need to keep interest rates high to bring inflation under control.

    Warsh Signals That Further Tightening Remains Possible

    Warsh suggested that the Fed’s fight against inflation may not be over, saying that financial conditions don’t seem restrictive enough right now. Although he did not promise an immediate rate hike, the Fed chair made clear that additional monetary tightening remains on the table.

    That outlook is changing investor positioning, particularly for assets that tend to perform well when money is inexpensive and interest rates are low.

    What the Sell-Off Means for Bitcoin and Gold

    Warsh’s remarks and the broader market sell-off have added uncertainty for investors. The key question is whether Bitcoin’s and gold’s recent gains reflected genuine, long-term market shifts or were driven largely by expectations that monetary policy would become increasingly supportive.

    Investors are now watching the dollar, Treasury yields and interest-rate expectations for further signals. A stronger dollar could make conditions more difficult for both Bitcoin and gold by reducing their appeal.

    If the dollar continues to rise and yields remain elevated, Bitcoin may face further pressure. However, if markets interpret Warsh’s comments as a warning rather than a signal of aggressive rate hikes, the latest decline could prove to be another sharp market swing rather than the start of a prolonged downturn.

    Warsh’s speech was not the only factor behind the decline. Markets were already highly sensitive, with investors preparing for a significant signal on the future direction of monetary policy.

    For now, Bitcoin’s decline and gold’s underperformance suggest that investor sentiment has shifted away from hedging against currency devaluation and toward assessing how many additional interest-rate hikes markets may still need to price in.

    Source: cryptonews.net

  • Bitcoin Rally Stalls, but Long-Term Sentiment Remains Bullish

    Bitcoin Rally Stalls, but Long-Term Sentiment Remains Bullish

    Bitcoin fell to $76,877 on Friday after Federal Reserve Chair Kevin Warsh delivered a hawkish keynote at Jackson Hole, confirming the resistance zone that had limited the cryptocurrency earlier in the week.

    September rate-hike expectations rose to approximately 56%, up from about 35% a day earlier, after Warsh said the Federal Reserve still has “work to do” on inflation. Despite the sell-off, Myriad traders continued to favor Bitcoin rising to $84,000 over falling to $55,000.

    Bitcoin declined from an overnight high of $81,455, surrendering most of its double-digit weekly gain. The high was reached within a resistance zone that had already capped several attempted breakouts this year.

    Myriad: How high will Bitcoin go? Click to make your prediction.

    Warsh’s Jackson Hole speech drives Bitcoin lower

    Warsh marked his 100th day as Fed chair by offering markets no fresh policy guidance, but his comments were enough to pressure risk assets. In his keynote, he said the Fed needs to see inflation moving clearly toward its target and doing so at a sufficient pace before it can declare its work complete. Until then, the central bank still has “work to do.”

    Traders interpreted the remarks as hawkish. According to the CME Group’s FedWatch tool, the probability of a September rate hike increased to 55.7% from 35.4% the previous day.

    The move also affected leveraged crypto positions. CoinGlass data showed approximately $481 million in liquidations across the cryptocurrency market during the 24 hours surrounding the speech. More than $360 million involved long positions caught off guard by Bitcoin’s decline. Bitcoin ended Friday at $77,557, down 3.39%.

    Bitcoin price analysis: What the charts show

    From a technical perspective, the pullback looks more like a consolidation phase than a confirmed trend reversal. Bitcoin’s Relative Strength Index stands at 69.7, below the overbought level above 80 that preceded Tuesday’s rejection. Meanwhile, the Average Directional Index is near 39.5, still indicating a strong trend rather than a broken one.

    Bitcoin remains within the bullish move that carried it from the June low near $68,858 to this week’s high around $81,455. If selling intensifies, traders are likely to monitor the $73,670-$75,157 area first. A close below that zone would put both the 50-week moving average and the June breakout structure under pressure.

    On the upside, the $81,000-$82,500 area remains the key resistance shelf. Bulls need to reclaim it to establish a path toward fresh highs.

    Myriad traders continue to favor Bitcoin at $84,000

    The longer-term bullish outlook is reflected in Myriad’s “BTC next move” market, which has been active since late February. The market has recorded $231,000 in trading volume and has no fixed resolution date.

    Its two outcomes—a move to $84,000 or a decline to $55,000—have repeatedly exchanged the lead since spring as Bitcoin’s price moved sharply in both directions. That pattern changed this month: the probability of the $84,000 outcome rose by 31.7 percentage points to 77%, compared with 23% for the $55,000 scenario. Friday’s rejection from resistance did not materially alter that split.

    Myriad: Where does Bitcoin go next? Click to make your prediction.

    The last time traders were this bullish was around April.

    Bitcoin’s fundamental support remains intact

    The fundamental case for higher Bitcoin prices has not significantly changed. U.S. spot Bitcoin exchange-traded funds recorded $2.8 billion in inflows over eight consecutive days through Wednesday, their longest such streak since April.

    The demand followed a Treasury Department announcement that it would at least double its purchases of long-dated bonds beginning September 9. The move supports a segment of the bond market that has faced weak demand since June. Lower long-term yields and a weaker dollar revived the “debasement trade” that helped Bitcoin climb from approximately $62,000 to $80,000 this month.

    Warsh’s remarks did not change that backdrop. He outlined no explicit interest-rate path and instead highlighted an inflation condition the Fed has not yet met.

    Why Bitcoin traders should watch the bears

    In the short term, the market setup still calls for caution. Warsh’s rejection of forward guidance leaves traders without a clear policy signal until the Fed’s next rate decision. Bitcoin therefore remains vulnerable to headline-driven volatility around every inflation report released before then.

    The PCE price index is increasing at an annual rate of 3.7%, nearly twice the Fed’s 2% target, and Warsh provided no timetable for inflation to return to that level.

    Bitcoin has already faced multiple rejections at the current resistance zone in recent months. Warsh’s speech gave bulls no clear reason to expect the Federal Reserve to make the next attempt at a breakout easier.

    Disclaimer

    The views and opinions expressed by the author are for informational purposes only and do not constitute financial, investment, or other advice.