The cryptocurrency market has been under bearish pressure, resulting in a 5.58% decline in overall market capitalization. Leading cryptocurrencies like Bitcoin and Ethereum experienced significant drops.
Crypto Market Decline
The cryptocurrency market declined by 5.58% amid bearish sentiment. Bitcoin, the leading cryptocurrency, dropped to an eight-day low of $58,034, marking a 5% decline. Ethereum also faced a sharp downturn, briefly falling to a 20-day low of $2,481.
Jerome Powell's Comments
Amid this turmoil, Federal Reserve Chair Jerome Powell’s comments at the Jackson Hole symposium were notably dovish. Powell indicated that the “time has come” to lower interest rates to prevent the job market from cooling excessively. This sentiment is further underscored by last week’s significant job revision of -800,000, increasing the likelihood of the Fed prioritizing the prevention of a job market collapse. According to QCP, the threshold for a 50 basis point rate cut in September is now considerably lower.
Can Market Recover?
The market is currently pricing in four rate cuts for 2024, despite only three meetings remaining. Meanwhile, US equity markets have shown resilience, nearing all-time highs. However, QCP Broadcast remains cautious, suggesting that equities might peak again due to declining trading volumes and the upcoming earnings report from Nvidia (NVDA). NVDA options are pricing in up to a 10% move higher.
It is worth noting that $110 million was liquidated from the market in recent hours, highlighting the severity of the sell-off.
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