Ethereum climbs to a new peak of $4,950 after Fed Chair Powell suggests interest rate reduction

In the dynamic world of cryptocurrencies, both Bitcoin and Ethereum have experienced a mix of gains and losses over the past week.

At the time of publication, Ethereum was trading at $4,719, marking a 1.45% decline in 24 hours. This drop follows a brief surge nearly 7% to $4,600 within minutes of Federal Reserve Chair Jerome Powell's dovish comments about potential interest rate cuts. Despite this dip, Ethereum remains well above levels seen before Powell's Jackson Hole appearance.

Over the weekend, Ethereum built on those gains, reaching a new all-time high of $4,954.81 on Sunday. However, a pullback occurred due to the liquidation of $210 million in leveraged long positions, causing a temporary setback.

Meanwhile, Bitcoin has faced a more challenging period. The digital currency broke below critical support at $118,859 due to selling pressure, with its lowest price reaching $110,779, its weakest level since July 10. Bitcoin declined 2.19% in 24 hours, extending a seven-day losing streak to 2.74%. The decline was exacerbated by miner selling, with 5,066 BTC worth approximately $569 million being liquidated.

The Relative Strength Index indicates overbought conditions for Ethereum, suggesting a potential correction could be on the horizon. Market participants are now focused on upcoming economic data and the Fed's September 18 policy meeting for further clarity on the central bank's rate trajectory.

In positive news, corporate treasuries have begun accumulating Ethereum for yield generation. Bitmine Immersion Technologies, chaired by Wall Street strategist Tom Lee, purchased $45 million worth of Ethereum over the weekend. This institutional investment aligns with the growing interest in Ethereum as a viable asset for long-term holdings and yield generation.

The Fed chief's comments continue to underpin medium-term sentiment for both cryptocurrencies, with the potential for interest rate cuts providing a positive outlook for the market. As the market evolves, it will be interesting to see how these trends develop in the coming weeks.

Ethereum climbs to a new peak of $4,950 after Fed Chair Powell suggests interest rate reduction