Bitcoin price outlook ahead of Powell’s Jackson Hole speech

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Federal Reserve Building

Bitcoin (BTC/USD) has touched an intraday low of around $21,376 across major exchanges, according to data from CoinGecko. This follows a rejection near $21,800, and suggesting further weakness could push the price towards 7-day lows below $21k. Fresh pain could follow if bulls give up the $20k zone.

That, in short, is Bitcoin’s price outlook ahead of US Federal Reserve Chair Jerome Powell’s Jackson Hole speech.

Bitcoin price: analyst views ahead of Jackson Hole

The Jackson Hole symposium, which brings together central bankers, economists and other key policymakers, is an annual event that has often come with increased market volatility around highly anticipated commentary.

The S&P 500 index, for instance, has built in the sentiment that the central bank will ease rates in coming months before pivoting later next year. It’s a scenario that had the stock market tracking significant bounces from June lows, with inflation seen as stabilising and an easing Fed seen as one that provides fresh legs for bulls.

So, as with the equities markets, Bitcoin might trade higher if the Fed Chair hints at lower rates after the September hike.

Keith McCullough, the CEO of Hedgeye Risk Management, says “anything dovish” could see Wall Street pump.

But if the Fed chooses to go tighter for much longer, then the markets will likely react lower over coming days.

Such an outcome will likely impact earnings estimates and see S &P 500 gains seen over the past month, for instance, wiped out in coming weeks as volatility pushes risk assets lower. Market analyst Tar points to a proper reaction in this case when stocks open on Monday.

Bulls need to hold above $20k

BTC has traded above the $20,000 level for weeks, the level providing a robust support during the recent sell-off from $25k. Some market observers see the zone as continuing to act as a strong buffer, although a breakdown to June lows is still possible with the current macro outlook.

Bitcoin analyst Carl Runefelt says that BTC looks weak on the 4-hour chart and that it risks falling to $20,800, potentially opening up a path for further declines towards the $20k level or lower.

At the moment, Bitcoin is down 1.3% in the past 24 hours, and US stock futures are also currently lower as the markets await the Fed Chair’s comments.

The post Bitcoin price outlook ahead of Powell’s Jackson Hole speech appeared first on Invezz.

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