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25 August 2025,07:37

Daily Market Analysis

Crypto Market Rallies on Fed Dovish Signals, But Momentum Fades

25 August 2025, 07:37

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Key Takeaways:

*Powell’s Jackson Hole remarks signaled rising risks to employment and a possible September rate cut, driving risk-on sentiment.

*BTC jumped nearly 4%, while ETH rallied over 14% to a fresh record high — its biggest single-day gain in August.

*U.S. PCE inflation data this week could shape Fed policy expectations and guide crypto’s next move.

Market Summary:

The crypto market staged a strong rally on Friday after Federal Reserve Chair Jerome Powell struck a dovish tone at the Jackson Hole Economic Symposium in Wyoming. Powell acknowledged rising downside risks to employment and signaled the possibility of an interest rate cut at the Fed’s September meeting.

Traders ramped up bets on a rate cut, with probability estimates climbing above 80%, boosting risk appetite across financial markets and fueling buying pressure in cryptocurrencies. Bitcoin (BTC) gained nearly 4% on Friday, marking its largest single-day gain in August, while Ethereum (ETH) surged over 14%, propelling the second-largest cryptocurrency to a fresh record high.

However, the rally proved short-lived. As markets digested Powell’s remarks over the weekend, cryptocurrencies gave up part of their Friday gains, with the Crypto Fear & Greed Index remaining in neutral territory, suggesting that buying momentum lacks persistence. Additionally, BTC and ETH ETFs continue to record net outflows, limiting the upside potential for both tokens.

Looking ahead, traders will focus on this week’s U.S. PCE inflation data, which could provide clearer guidance on the Fed’s next policy move and set the tone for the crypto market’s near-term direction.

Technical Analysis

ETH, H4

Ethereum (ETH) broke out of its downtrend channel, surging about 14% from the breakout point and signaling a strong bullish reversal. The token is now hovering near its all-time high, but a rejection below the psychological $5,000 level suggests a potential technical pullback in the near term.

On the downside, the $4,665 level serves as a key short-term support. A sustained hold above this level would indicate that ETH remains within its bullish trajectory. Meanwhile, the RSI is approaching the overbought zone, and the MACD remains elevated, both of which suggest that bullish momentum remains intact, though some consolidation may be likely before the next leg higher.

Resistance level: 5020.00, 5255.00

Support level: 4555.00, 4330.00

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