Bitcoin (BTC) slipped to around $78,400 on Friday as traders reacted to Federal Reserve Chair Kevin Warsh’s remarks at the Jackson Hole Symposium, where he maintained a cautious stance on US inflation.
BTC/USD fell to $78,442 on Bitstamp during volatile trading, down roughly 1% at the time. Bitcoin later moved around the $79,500 level after failing to secure a decisive breakout above $80,000.
In his first keynote speech at the annual Jackson Hole Symposium, Warsh reiterated the Federal Reserve’s commitment to its 2% inflation target and indicated that recent improvements in inflation data were not enough to confirm a sustained downward trend.
Warsh said recent Consumer Price Index (CPI) and Personal Consumption Expenditures (PCE) readings were better than expected but argued that underlying inflation trends had not improved significantly.
He also signaled a shift away from regular forward guidance, saying the practice adopted during the global financial crisis had outlived its usefulness.
Warsh’s cautious comments initially pressured Bitcoin, while US stocks remained positive. The S&P 500 and Nasdaq Composite were both up around 0.5% at the time of the report.
Bitcoin continued to trade around the $80,000 level as investors assessed the outlook ahead of the August monthly close.
Market analysts have identified $83,000 as an important level for Bitcoin to reclaim in order to strengthen its upward momentum. Bitcoin also needs to hold the 50-week exponential moving average near $77,250 to maintain its broader uptrend.
On-chain data shows significant resistance between the current price and $86,000, potentially limiting further gains.
QCP Capital said derivatives markets could play an important role in supporting any additional Bitcoin rally. The trading firm noted that a healthy move higher would ideally be accompanied by controlled funding rates and a gradual increase in open interest rather than a rapid buildup of leverage.
According to the analysis, the key question is whether any move above $83,000 is supported by spot buying or increasingly driven by leveraged positions.
Despite Friday’s decline, Bitcoin remained up 26.35% month-to-date, putting it on track for its strongest August performance since 2017.
