Bitcoin News Today: Bitcoin's Bull Run Revived by Powell's Pivot Toward Easing

Bitcoin's price surged over the weekend, reversing recent losses and consolidating above $116,000, following remarks from Federal Reserve Chair Jerome Powell at the Jackson Hole Symposium. Powell's speech hinted at the possibility of an interest rate cut as soon as September, which shifted investor sentiment from cautious to bullish. The cryptocurrency climbed nearly 5%, reaching an intraday high of $117,300 on Bitstamp, wiping out short positions worth $379.88 million, according to CoinGlass data. Ether (ETH) also saw significant gains, surging over 15% to $4,760, liquidating $193 million in short positions [1].

The market reaction was swift and widespread. Prediction markets now assign an 87% probability of a 25-basis-point rate cut in September, up from 75% before Powell's speech. This increased optimism led to a broader risk-on trade across financial markets, with Bitcoin-proxy stocks such as Marathon Digital (MSTR) and Coinbase (COIN) rising by over 5% and nearly 7%, respectively. The renewed appetite for risk assets reflected a broader shift in market positioning, particularly after several weeks of bearish sentiment [2].

Analysts were quick to note the significance of the price action. Michael van de Poppe, founder of MN Capital, highlighted the importance of the sweep below $112,000 as a potential entry point for long positions. He described the move as a sign that the BTC uptrend has resumed. Fellow analyst Jelle added that while some retracement could occur, the overall direction appears to be upward. BitQuant has maintained a $145,000 price target for Bitcoin through 2025, and André Dragosch of Bitwise suggested that regulatory changes, such as allowing crypto in U.S. 401(k) retirement accounts, could push prices to $200,000 by year-end [1].

Meanwhile, Bitcoin's volatility has continued to decline, with annualized volatility now at 38%, a stark contrast to the near 200% levels seen over a decade ago. This maturation has led to a shift in trading behavior, with investors and hedge funds increasingly viewing Bitcoin as a long-term asset. Ethereum, in contrast, has seen a rise in speculative activity, with ETF volumes for ETH occasionally surpassing those for BTC. This trend reflects the ongoing rotation in risk appetite and the search for more volatile assets within the crypto space [3].

Despite the positive momentum, some traders remain cautious. Jeff Dorman of Arca noted that much of the recent activity has been concentrated in Bitcoin and Ether, with little movement in smaller altcoins. Arthur Azizov of B2 Ventures predicted that Ethereum may consolidate within a range of $3,900 to $4,400, though he warned of the risk of a sharp pullback to the $3,000s if leveraged positions unwind. This highlights the delicate balance between optimism and caution in the market [3].

The broader implications of Powell’s comments and the market’s response are still emerging. With the Fed signaling potential policy easing, investors are recalibrating their expectations and strategies. Whether this will lead to a sustained bullish trend for Bitcoin and the wider crypto market remains to be seen, but the immediate reaction has been robust and aligned with the expectations of many industry observers.

Source: [1] Bitcoin price breakout to $117K liquidates bears, opening door to fresh all-time highs (https://cointelegraph.com/news/bitcoin-price-breakout-to-dollar117k-liquidates-bears-opening-door-to-fresh-all-time-highs) [2] Bitcoin and Crypto Stocks Surge as Powell's Rate-Cut Hint Revives Risk Appetite (https://www.investopedia.com/bitcoin-and-crypto-stocks-surge-as-powell-rate-cut-hint-revives-risk-appetite-11795898) [3] Bitcoin-Volatility Collapse Forces Risk-Loving Traders to Hunt for New Playground (https://finance.yahoo.com/news/bitcoin-volatility-collapse-forces-risk-112008080.html)