Circle (CRCL) Surges 4.9% on Fed Rate-Cut Hints and Crypto Rally Momentum

Summary
• CRCL jumps 4.9% to $138.26, hitting an intraday high of $144.70
• Fed Chair Powell’s Jackson Hole speech sparks crypto-linked stock surge
• Options chain sees heavy volume in 130–140 strike range
• Leveraged ETFs CRCG and CRCA surge 9% as CRCL volatility spikes

Circle’s stock has surged nearly 5% in a volatile session driven by Federal Reserve Chair Jerome Powell’s dovish remarks at Jackson Hole. The move aligns with a broader crypto rally as investors price in a September rate cut. With CRCL trading near its 52-week high of $298.99, the stock’s sharp rebound from a 52-week low of $64 underscores its sensitivity to macroeconomic shifts and crypto market sentiment.

Fed's Rate-Cut Signal Ignites Crypto-Linked Stock Surge
The Federal Reserve’s pivot toward rate-cut expectations has catalyzed a sharp rebound in crypto-linked equities. Powell’s Jackson Hole speech, which hinted at a September rate cut amid cooling inflation and labor market strains, triggered a 4.9% intraday surge in CRCL. The stock’s performance mirrors broader crypto gains, with Bitcoin and Ethereum rising alongside CRCL. Analysts attribute the move to easing financial conditions, which reduce borrowing costs and boost speculative assets. CRCL’s 144.70 intraday high reflects renewed investor confidence in its stablecoin ecosystem and blockchain infrastructure amid a dovish Fed outlook.

Capital Markets Sector Rally Led by Fed-Driven Optimism
The Capital Markets sector, led by CRCL’s 4.9% gain, outperformed broader indices as Fed rate-cut expectations lifted risk appetite. Sector peers like Goldman Sachs (GS) rose 3.7%, while leveraged ETFs like CRCG and CRCA surged 9%, amplifying CRCL’s volatility. The sector’s rally reflects a shift in investor sentiment toward high-growth fintech and crypto infrastructure plays, with CRCL’s stablecoin platform positioning it as a proxy for digital asset adoption.

Leveraged ETFs and Options Playbook: Navigating CRCL's Volatility
• RSI: 31.41 (oversold)
• MACD: -12.65 (bearish divergence)
• Bollinger Bands: 122.79–197.89 (wide range)
• 200D MA: 176.54 (CRCL trading below)

CRCL’s technicals suggest a short-term rebound after hitting oversold RSI levels, but the bearish MACD and wide Bollinger Bands indicate high volatility. Aggressive bulls may consider CRCL20250829C135 (strike: $135, IV: 72.37%, delta: 0.605, theta: -0.767, gamma: 0.026) for a 5% upside scenario (target: $145.17). This call option offers a 46.67% price change potential with moderate delta and high gamma, ideal for a sharp move. For downside protection, CRCL20250829P130 (strike: $130, IV: 67.78%, delta: -0.257, theta: -0.075, gamma: 0.023) provides a 52.65% leverage ratio and high liquidity (turnover: 494,923). Both contracts benefit from elevated implied volatility and strong gamma, making them responsive to CRCL’s rapid price swings. Leveraged ETFs like CRCG (9.19%) and CRCA (9.11%) offer amplified exposure to CRCL’s momentum, though their 2X leverage amplifies risk in a volatile environment.

Backtest Circle Stock Performance
The backtest of CRCL's performance after a 5% intraday surge shows favorable short-term gains, with the 3-day win rate at 52.63% and the 10-day win rate at 52.63%. However, the 30-day win rate drops to 31.58%, indicating potential volatility in the longer term. The maximum return during the backtest was 18.48% over 9 days, suggesting that while there is potential for gains, there is also a risk of reduced performance in the following weeks.

Bullish Momentum Intact—Position for CRCL's Next Move
CRCL’s 4.9% surge reflects a pivotal shift in macroeconomic sentiment, with Powell’s rate-cut hints fueling crypto-linked optimism. While technicals suggest a short-term rebound, the bearish MACD and wide Bollinger Bands caution against overextending long positions. Investors should monitor the 130–140 strike range for options activity and watch for a break above the 200D MA at $176.54. The sector leader, Goldman Sachs (GS), rising 3.7%, reinforces the Capital Markets sector’s alignment with rate-cut expectations. Aggressive traders may consider CRCL20250829C135 for a 5% upside target, while hedging with CRCL20250829P130. Position sizing and stop-loss placement remain critical in this high-volatility environment.