Wall Street Rallies on Powell’s Dovish Signal
At the annual Jackson Hole symposium, Federal Reserve Chair Jerome Powell struck a dovish tone, noting that the “shifting balance of risks may warrant adjusting our policy stance.” Markets read this as a signal that the Fed could cut rates as early as September 2025, marking one of Powell’s clearest hints of a policy pivot from inflation control to growth support.
Why It Matters
After two years of elevated interest rates weighing on equities, credit, and risk assets, Powell’s remarks offered reassurance that the Fed sees room to ease. For investors, this suggests a possible new cycle of risk appetite, benefiting equities, bonds, and alternative assets under looser financial conditions.
Market Impact:
- Bonds & Rates → Treasury yields fell, with futures pricing in higher odds of a September cut.
- Equities → The S&P 500 rebounded, while the Russell 2000 outperformed on growth optimism.
- Currencies & Risk Assets → The dollar weakened; Bitcoin and gold rallied on lower yield expectations.
- Momentum → The speech reinforced optimism after the Dow Jones’ 846-point surge to its first record close of 2025.
Inflation has cooled closer to target, though growth data remains mixed: GDP is resilient but labor markets are softening. Globally, Powell’s signal boosted equities in Europe and Asia, with bond yields retreating. The Fed now faces a balancing act—cut too slowly and risk a slowdown, too quickly and risk reigniting inflation.
Powell’s dovish tone delivered the rally signal markets were waiting for. If cuts materialize, small-caps, tech, and cyclical stocks could benefit most, while gold and Bitcoin remain supported by weaker yields and a softer dollar. The main risk: a resurgence in inflation that could delay easing.
BTC Technical Analysis
Bitcoin broke below $115k and is now trading around $113k, confirming a lower-high, lower-low (bearish) structure. Price sits below all major EMAs (20/50/100/200), reinforcing bearish bias. The Stochastic RSI is near oversold, which may allow a short-term relief bounce, but the broader trend remains under pressure unless BTC reclaims $115k–116k.
- Structure: Bearish (LH/LL)
- EMA: Below all EMAs → momentum weak
- Stoch RSI: Oversold, potential short bounce
Between August 20 and August 22, 2025, Bitcoin ETFs posted net flows of –$315.9 million, –$194.4 million, and $23.2 million. The back-to-back outflows point to renewed investor caution, though the modest inflow on the final day hints at early signs of stabilization.
Overall, the trend shows sentiment toward BTC remains fragile in the short term. A consistent pickup in inflows will be key to supporting price recovery and reviving the broader bullish outlook.
ETH Technical Analysis
Ethereum is holding $4,700 after a pullback from $4,800, keeping a higher-low structure intact above $4,500. ETH trades above the 20/50/100 EMAs, with the 20 EMA acting as near-term support, showing relative strength vs BTC. The Stochastic RSI is mid-range (~40), suggesting momentum is cooling but not yet oversold.
- Structure: Bullish (HLs above $4,500).
- EMA: Above 20/50/100 → trend supportive.
- Stoch RSI: Cooling, room for reset before continuation.
Between August 20 and August 22, 2025, Ethereum ETFs recorded flows of –$240.2 million, $287.6 million, and $337.7 million. While the sharp outflow on the first day signaled investor caution, the strong back-to-back inflows that followed highlight renewed institutional demand.
This rebound suggests growing confidence in Ethereum’s outlook. If inflows maintain momentum, they could provide a fresh catalyst for ETH’s short-term recovery and reinforce its medium-term bullish trajectory.
SOL Technical Analysis
Solana is consolidating near $211 , holding a strong higher-high, higher-low structure. It remains well above the 20/50 EMAs, confirming bullish momentum. However, the Stochastic RSI is overbought (~85–90), signaling risk of near-term consolidation before further upside toward $220.
- Structure: Strong bullish (HH/HL).
- EMA: Well above 20/50 → momentum strong.
- Stoch RSI: Overbought, cooling likely.
The latest data shows that DEX trading volume remains elevated in 2025 compared to prior years, but has eased off from the sharp spikes seen earlier this year. While activity is still well above 2023 levels, the recent moderation signals a cooldown in trading momentum, suggesting participants are becoming more selective in deploying liquidity within the decentralized ecosystem.
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