Ethereum Down 2% on Hawkish Pivot by Fed Chair Kevin Warsh
Ethereum (ETH) price dipped 2.10% to $2,435.43, closely tracking a broad market decline, primarily driven by a hawkish shift in Federal Reserve policy.
Traders reacted to a hawkish pivot by Fed Chair Kevin Warsh at the Jackson Hole symposium, reviving expectations for a September interest rate hike and triggering a risk-off move across crypto.
US Fed chair emphasised that inflation remains above the Fed’s 2% target and that the economy is strong, putting a potential September rate hike back on the table.
This caused a sharp, correlated drop in Bitcoin and most major altcoins, with the total crypto market cap falling over $80 billion.
Ethereum’s move was not coin-specific but a reaction to shifting expectations of tighter U.S. monetary policy, which reduces the appeal of speculative assets.
The outcome of the Fed’s September meeting- a rate hike could sustain pressure, while a hold may provide relief.
Investors booked profits after Ethereum’s rally toward the key $2,500 resistance level, which was amplified by derivative market liquidations.
Ethereum’s drop coincided with a rejection at the psychologically significant $2,500 level, an area it had rallied toward in preceding days.
ETH’s price action is dominated by the $2,550 resistance level. After a rally from August 21 lows, ETH was rejected from the $2,520-$2,540 zone on August 27-28, pulling back to $2,435.
Analysts note that a weekly close above $2,550 could open the path to $3,000, while a failure risks a drop toward the $2,100 support.
The repeated rejection shows selling pressure at this level, and the market needs a decisive catalyst to break through. Traders should watch for a sustained move above $2,480 as the first sign of renewed bullish momentum.
Analysts noted this looked like a “healthy reset” and profit-taking after a strong run. The move was exacerbated by liquidations in the derivatives market, with over $267 million in crypto positions liquidated in 24 hours around the event.
Technical selling and the unwinding of leveraged positions amplified the macro-driven decline.
The immediate trend is testing key support. Ethereum is currently testing the $2,400 level, which is now critical. The 24-hour volume of $14.05B shows significant activity during the sell-off.
The bearish pressure is real, but the structure of the prior uptrend isn’t yet broken. Holding $2,400 is crucial for bulls to maintain the momentum from its recent 27% monthly gain.
A daily close below $2,400, which could trigger a deeper pullback toward the next major support at the 38.2% Fibonacci retracement level near $2,280.
Ethereum’s decline is a direct response to a hawkish macro surprise, with technical selling adding momentum. The key question is whether institutional ETF inflows—which remained strong—can provide a floor. Ethereum Price Rises as Bitmine Immersion Tech Boosts Holding
