- With Jerome Powell’s return to Jackson Hole this Friday, the Bitcoin (BTC) market is experiencing a sense of anticipation due to similarities to the period before last year’s speech.
- According to Keith Alan, two weeks before last year’s speech, the BTC price broke critical technical support levels represented by the 21-day, 50-day, 100-day, and 200-week Moving Averages (MA).
- It is uncertain whether Powell will have a hawkish or dovish stance in his upcoming speech, making it difficult to predict the market’s reaction.
Federal Reserve Chairman Jerome Powell will speak at the Jackson Hole Symposium on Friday; Why is this very important for Bitcoin?
Fed Chairman to Speak at Jackson Hole
With Federal Reserve Chairman Jerome Powell’s return to Jackson Hole this Friday, the Bitcoin (BTC) market is experiencing a sense of anticipation similar to the period before last year’s speech.
Important moving averages were tested and lost in the past two weeks, followed by a consolidation period reminiscent of previous events. However, it is important to note that these similarities do not guarantee a repeat of the past, as market conditions and Powell’s stance have evolved since then.
According to Keith Alan, co-founder of analysis and crypto research firm Material Indicator, two weeks before last year’s speech, the BTC price broke critical technical support levels represented by the 21-day, 50-day, 100-day, and 200-week Moving Averages (MA).
This was followed by a consolidation period, and after Powell’s hawkish stance in the speech, a significant price drop occurred. Alan said:
“When Fed Chairman Powell spoke at Jackson Hole last year, his hawkish stance triggered a 29% BTC drop, and it took 5 months for the recovery from this drop.”
Specifically, the recent price movement in the Bitcoin market shows similarities to last year’s landscape. In the past two weeks, Bitcoin tested and lost the same key moving averages, and is currently going through a consolidation period reflecting previous events leading up to Powell’s previous address.
Keith Alan emphasizes that there have been significant changes since last year’s Jackson Hole event. Core inflation has declined and Powell’s communication approach has become more “measured.”
Markets uncertain about Powell’s speech
It is uncertain whether Powell will have a hawkish or dovish stance in his upcoming speech, making it difficult to predict the market’s reaction. However, it is clear that the market is ready for a significant move.
Additionally, Alan suggests that forming a lower low in price increases the likelihood of an extension of the current downtrend. Market participants should be prepared for the possibility of further testing of support levels.
While the Bitcoin market awaits Powell’s speech, market sensitivity continues to remain dynamic. Traders and investors are waiting for clues about potential market movements from the event.
As the date of Jerome Powell’s return to Jackson Hole approaches, Bitcoin has shown a notable recovery of 2.1% in the past 24 hours, indicating a more positive upward movement closer to the $27,000 threshold.
If Friday’s speech by Jerome Powell results in a positive outcome for crypto investors and pushes Bitcoin’s price higher, it is important to remember that the cryptocurrency may encounter a significant obstacle in the form of the 200-day moving average at the $27,200 level.
