Ethereum Price Plummets 9% As Fed Chair Passes Hawkish Remarks
The crypto community has witnessed another price plunge after the just concluded Federal Reserve annual meeting. Many investors already anticipated a new turn in asset prices after Jerome Powell spoke on the approach to combat inflation. But from the turn of events, Powell tipped the scale against investors’ expectations. As a result, many cryptocurrencies and equities have already started a downward price trend.
Ethereum (ETH) and many other cryptocurrencies have lost some August 25 price gains. After the meeting, ETH’s price tanked 9% and stood at $1555. But the bears continued to push the price lower. Some hours later, in the evening, ETH plummeted lower to $1478 before climbing up gradually.
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As of the time of writing, ETH is still in the reds on August 27. The price fluctuates between $1499 and $1505. The coin struggled to climb a bit higher than the August 26 lowest point of $1478 to stand at $1,499, showing a 9.68% loss.
Bitcoin And Stocks Didn’t Fare Better
Bitcoin and equities lost gains following the Fed annual meeting too. BTC price early morning August 26 was $21,596.09. It recorded an intraday high of $21,804. But later, BTC started a terrible downtrend to a peak low of $20,036 before climbing sluggishly upwards. At the close of the market, BTC’s price was $20,260.02. As of August 27, BTC is at $20,206 and still fluctuating lower.
Other stocks also fell after Powell’s hawkish approach decision. For instance, S&P 500 lost more than 3% of its gains after the meeting. Dow Jones Industrial Average lost more than 1000 points while Nasdaq Composite recorded almost 4%.
Any Market Reversal in Sight?
The crypto market expected a price movement depending on the meeting’s outcome. Many people expressed their worries on August 26 before the meeting, stating that a dovish approach will mean positive price movement while a hawkish decision will mean an extended bearish trend.
Recall that the Minneapolis Fed CEO and President Neel Kashkari suggested a Volcker Esque rule to combat inflation. Paul Volcker was the Fed Chair who created two recessions to fight inflation. Kashkari’s suggestion already had everyone worried about the outcome of the annual meeting. Unfortunately, Powel’s insistence that the central bank won’t adopt a dovish approach but will maintain its aggressive strategies to restore price stability has tipped the scale negatively.
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It is happening when many analysts expect the Ethereum Merge to improve crypto prices.
The number of $ETH deposits into the Beacon chain contract is now at a stable but macro low of 220 deposits/day.
This may signify a stable holding pattern is been reached, as investors await a successful Merge, scheduled for mid-September.
Live Chart: https://t.co/uVDy2zfZBr pic.twitter.com/rmXoSKAqr0
— glassnode (@glassnode) August 23, 2022
But with the current events in the financial markets, the upcoming upgrade might not have the desired positive effect on Ethereum and other crypto prices. Another period of price crash might be imminent.
Data have already shown that the deposits of ETH into the Beacon Chain have reduced. Also, many people are stating that the market has already “Priced In” the Merge.
Featured image from Pixabay and chart from TradingView.com