Fed Chair Jerome Powell struck a surprisingly dovish tone in his highly anticipated speech at Friday’s Jackson Hole symposium.
“The shifting balance of risk may warrant changing our policy stance”, Powell announced, resulting in a broad-based rally in equities and crypto.
While acknowledging the elevated inflation levels, the Fed Chair clearly gave more weightage to the downward risk in the labour market, hinting at a departure from the central bank’s restrictive monetary policy and rate cuts this year.
Jerome Powell’s dovish speech has sent the crypto prices soaring, with altcoins leading the charge. The Ethereum price is up by nearly 13% on Friday, trading at $4,800 at press time and just 2.5% away from a new all-time high.
The Bitcoin price has also reclaimed the $116,500 level, and a daily close above it could pave the way for an explosive rally in altcoins.
Morpho, Aerodrome Finance and SPX6900 are among the top crypto gainers today, while Ethereum ecosystem coins like Arbitrum, Ethereum Classic, Ethena, and Ethereum Name Service are also showing significant strength.
A new crypto bull market appears to be on the horizon as the Fed signals a September rate cut. For sidelined investors, the smartest move is to target coins that have broken through key resistance levels and, therefore, have strong upside potential.
What Jerome Powell’s Speech Today Means For Crypto?
Jerome Powell’s Jackson Hole speech was his first public address after July’s disastrous jobs data report and the extremely hot PPI print.
The markets desperately needed guidance on whether the Federal Reserve would prioritize high inflation levels or the risk of growing unemployment and layoffs. The first supports a restrictive monetary policy, while the latter highlights the need for aggressive rate cuts.
Safe to say, the Fed Chair is prioritizing addressing the weakness in the labour market, revealing that the downside risk to employment is rising. He stated that both the supply and demand for labour are decreasing, a worrisome scenario for the US economy.
Powell also acknowledged the elevated inflation levels. However, he claimed that the base case is that the tariffs will have a short-term effect on prices. The Fed has, in fact, adopted a new policy framework, removing its longstanding reference to a 2% inflation target.
Simply put, the Federal Reserve is ready for a September rate cut, and the CME FedWatch shows that another 25 bps cut in the Fed target rate this year is now highly likely.
This is a decidedly bullish scenario for crypto prices, indicating that a new bull market is on the horizon.
Is A New Crypto Bull Market Underway?
Crypto prices are showing explosive bullish strength in the aftermath of Jerome Powell’s dovish speech today.
However, sidelined investors should still exercise caution. Take, for instance, the aftermath of Jackson Hole 2024. The Bitcoin price surged by nearly 8% in a couple of days after Powell’s speech, only to reject from key resistance levels and see a 20% decline.
As a result, investors should wait for a weekly close above $116,200 in Bitcoin, and $4800 in Ethereum. This would confirm the start of a new bull trend.
Best Cryptos To Buy Now
Ethereum continues to be the best large-cap crypto to invest in. With the ongoing stablecoin adoption, aggressive accumulation by treasury firms and strong whale demand, ETH remains poised to hit $10,000.
Smart money investors should also increase their exposure to Solana meme coins. Bonk, Fartcoin and SPX6900 saw explosive rallies in the aftermath of Powell’s speech, which suggests high latent demand. Once the broader market outlook improves, these will be among the top crypto gainers.
The same goes for Ethereum ecosystem coins like Arbitrum, Ethena and Ethereum Naming Service.
Low-cap meme coins are in high demand. For instance, TOKEN6900 has raised nearly $2.5 million in its viral ICO, thanks to strong whale demand.
Five figure investments are nearly a daily occurrence, and one whale purchased over $100k worth of T6900 in a single transaction.
TOKEN6900 encapsulates the spirit of the OG meme coins: Dogecoin and Pepe. It doesn’t offer any utility and doesn’t care about the macroeconomic data; the perfect meme coin for the current outlook. It only cares about the meme culture, strong community support and giving small-scale investors a chance to make big money.
Considering its low-cap nature and small-cap valuation, many are viewing TOKEN6900 as one of the best meme coins to buy now, while others are backing it as the next 100x crypto.
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