Ethereum Takes Hit as Hawkish Fed Expectations Weigh On Crypto Markets
Ethereum's price dropped after Fed Chair Warsh delivered a hawkish speech at the Jackson Hole Symposium, signaling a shift towards tighter financial conditions.
The market interpreted Warsh's comments as leaning against recent easing in financial conditions, which led to a reversal of the 'debasement' trades that had boosted Ethereum and other cryptocurrencies. The price of Ethereum extended its consolidation near monthly highs, but technical analysis suggests it may be due for a breakout.
A soft US CPI report could bring the probabilities below 50% and deter the Fed from hiking at the upcoming meeting, which would be positive for Ethereum. However, a hot CPI report or hawkish surprises should weigh on the cryptocurrency and trigger selloffs.