Ether Could Benefit as Crypto Fear and Greed Index Returns to Greed After Powell Hints at Possible September Rate Cut

• Crypto Fear & Greed Index: 60 (Greed)

• Bitcoin jumped ~5% to $117,300, liquidating $379.88M in shorts.

• Ether rose ~11.5%, reclaiming its 2021 all-time high near $4,878.

Crypto Fear & Greed Index: Returned to Greed at 60 after Powell’s Jackson Hole remarks—read how BTC and ETH reacted and what to watch next. Click for analysis.

What caused the Crypto Fear & Greed Index to return to Greed?

Crypto Fear & Greed Index moved from Neutral to Greed as Jerome Powell’s dovish Jackson Hole remarks increased market expectations of a September rate cut. The comments lifted liquidity expectations and risk appetite, quickly translating into higher prices for Bitcoin and Ether across major exchanges.

How did Jerome Powell’s Jackson Hole comments affect crypto prices?

Powell said current inflation and labor-market conditions “may warrant adjusting” monetary policy, prompting traders to price in easier policy ahead. Bitcoin surged roughly 5% to $117,300, liquidating $379.88 million in shorts. Ether climbed back toward its 2021 all-time high, reaching about $4,851—an 11.51% 24‑hour gain, according to CoinMarketCap.

The Crypto Fear & Greed Index, which quantifies market sentiment across volatility, momentum and volume, social media and surveys, rose to 60 on Saturday from Friday’s 50. The index briefly touched “Fear” earlier in the week before reversing with Powell’s remarks.

Why is Ether considered highly rate-sensitive?

Market participants increasingly view Ether as sensitive to interest-rate moves because lower rates widen the yield spread between stablecoin deposits in DeFi and USD deposits in banks. Axie Infinity co-founder Jeffrey “Jiho” Zirlin described Ether as “the most rate-sensitive aspect of crypto,” noting that falling rates typically increase demand for yield-bearing crypto strategies.

What do traders and data sources say about timing for a rate cut?

The CME FedWatch Tool shows a strong market-implied probability of a September rate cut, with about 75% of participants pricing a reduction ahead of the Sept. 17 meeting. Trading commentary from The Kobeissi Letter observed that Fed Chair Powell’s tone appears to be setting the stage for a September move. St. Louis Fed President Alberto Musalem said he needs more time and will update his view “two or three days before the meeting,” adding uncertainty to the timeline.

How did market structure react during the rally?

Short liquidations accelerated as prices moved higher. Bitcoin’s ~5% jump triggered $379.88 million in short liquidations, showing the speed at which derivatives desks adjust to macro signals. Historically, Fed rate cuts tend to increase liquidity and push investors toward risk assets, reinforcing the rally.

What did market commentators predict ahead of Jackson Hole?

Several traders and commentators predicted a crypto spike if Powell signaled easing. Author Jason Williams said if Powell “comes in soft and leans that rate cuts are likely, we turbo rip.” Crypto Banter trader Ran Neuner commented that “Jackson Hole will shape crypto’s direction moving forward,” highlighting the event’s outsized influence on sentiment.

How should investors interpret this move?

View this Greed signal as a short-term market sentiment shift driven by macro expectations, not a standalone forecast for long-term price trends. Traders should monitor Fed communications, the CME FedWatch Tool probabilities, on-chain liquidity metrics and derivatives funding rates to assess sustainability.

Comparison: BTC vs ETH reaction

Frequently Asked Questions

How reliable is the Crypto Fear & Greed Index for short-term trading?

The index is a useful sentiment gauge that captures short-term market psychology. It should be combined with price action, liquidity metrics and macro data for trade signals rather than used in isolation.

When might a Fed rate cut actually occur?

Market-implied odds point to September as a likely timing, but official decisions depend on incoming inflation and labor market data and votes by the Federal Open Market Committee members.

Key Takeaways

• Sentiment Shift: The Crypto Fear & Greed Index rose to 60, signaling renewed risk appetite.
• Macro Catalyst: Jerome Powell’s Jackson Hole remarks increased market odds of a September rate cut.
• Market Reaction: Bitcoin and Ether led the rally, with significant short liquidations and Ether reclaiming 2021 highs.

Conclusion

The Crypto Fear & Greed Index’s return to Greed reflects a rapid, macro-driven shift in investor sentiment after Powell’s dovish tone at Jackson Hole. Traders should track Fed communications, CME FedWatch probabilities and on-chain liquidity to assess whether this rally is sustainable. For ongoing coverage and analysis, follow updates from COINOTAG.