Bitcoin News Today: Global stocks and crypto cool as Fed hints at rate cuts

Global stocks experienced a noticeable slowdown on Monday as market participants paused to reassess risk appetite following a sharp rally at the end of last week [1]. The Dow Jones Industrial Average had surged by 846.24 points, or 1.89%, on Friday, pushing the S&P 500 and Nasdaq Composite to near record levels [1]. However, this momentum faltered as U.S. futures for the Dow dropped by 99 points, or 0.2%, by the following Monday [1]. The S&P 500 and Nasdaq 100 also edged down 0.2% and 0.3%, respectively [1].

The cooling off was not limited to equities. Both Bitcoin and Ethereum, which had seen substantial gains over the previous days, experienced pullbacks. Ethereum fell 5% to $4,588 after reaching a new all-time high of $4,954 just the previous day [1]. Bitcoin, too, lost steam, slipping by over 1% to $111,501 [1]. Over the weekend, Bitcoin hit a low of $110,779.01, its weakest level since July 10, after touching $124,496 on August 13 [1]. These corrections were attributed to market digestion of comments from Federal Reserve Chair Jerome Powell, who indicated that rate cuts were likely on the horizon [1]. This sent a wave of liquidation across leveraged positions, with over $245 million in Ethereum longs and $175 million in Bitcoin longs being wiped out in the past 24 hours [1].

The U.S. dollar also showed signs of cooling, with the dollar index rising 0.2%, making gold more expensive for holders of other currencies [1]. Spot gold prices fell 0.3% to $3,362.56 an ounce by mid-morning GMT, reversing some of its gains from the previous session [1]. The Chinese yuan strengthened to its highest in a month, partly due to the dollar's relative weakness [1]. Meanwhile, European stocks slipped, with the Stoxx 600 down 0.3% and key indices in Germany and France each falling about 0.5% [1].

In contrast, Asian markets continued to rally, with the CSI 300 in Mainland China rising 2.08% to a 37-month high [1]. The Hang Seng Index in Hong Kong climbed 1.94%, and the Hang Seng Tech Index surged 3.14% [1]. South Korea’s Kospi and Kosdaq also saw gains of 1.3% and 1.98%, respectively [1]. However, the broader global trend was one of caution, as investors looked ahead to key earnings reports, particularly from Nvidia, and awaited further guidance on Federal Reserve policy [1].

Analysts suggested that the decline in 30-day active supply for Bitcoin could indicate a period of consolidation [2], potentially setting the stage for a larger price movement in the near future [2]. Some traders are shifting their attention to Ethereum and its Layer 2 projects, suggesting that Bitcoin may face a period of subdued performance in August [3]. The dovish tone from the Fed, emphasizing job market cooling and inflation control, weighed on the dollar and made Bitcoin and Ethereum more attractive as hedges against dollar depreciation [4].

While gold and other traditional safe-haven assets lost momentum, the prevailing sentiment remained cautiously optimistic. Some analysts speculate on the potential for a market correction [6], but current evidence suggests a more likely scenario of short-term volatility followed by a continuation of the upward trend [6].

Market participants are now closely watching Nvidia's earnings report and broader macroeconomic data, including the upcoming Core PCE report, to gauge the trajectory of both stocks and digital assets [7]. The interplay between the Fed’s policy direction, corporate earnings, and crypto market dynamics is expected to remain a key focus in the coming weeks [7].

Source: [1] Global stocks cool off before Nvidia (https://www.cryptopolitan.com/global-stocks-cool-off-before-nvidia/)

[2] Bitcoin 30-Day Active Supply Signals Slow Activity (https://www.mitrade.com/insights/news/live-news/article-3-1064731-20250825)

[3] Bitcoin May Struggle in August as Ethereum & Layer Brett (https://www.mitrade.com/insights/news/live-news/article-3-1064141-20250824)

[4] Markets Explode Higher After Powell's Rate Cut Hint (https://www.metatradingclub.com/weekly-market-mornings-august-24-markets-explode-higher-after-powells-rate-cut-hint-2025/)

[5] The Fed's Dovish Pivot and the Rise of Institutional-Grade (https://www.ainvest.com/news/fed-dovish-pivot-rise-institutional-grade-crypto-macro-hedge-2508/)

[6] Is a Cryptocurrency Market Crash on the Horizon? (https://www.aol.com/cryptocurrency-market-crash-horizon-121000427.html)

[7] Core PCE Expected to Edge Up as Powell Tilts Toward Jobs (https://www.investing.com/analysis/macro-week-ahead-core-pce-expected-to-edge-up-as-powell-tilts-toward-jobs-200665820)