Bitcoin Rally Stalls, But Long-Term Sentiment Remains Bullish

In brief

• Bitcoin dropped as low as $76,877 on Friday after Fed Chair Kevin Warsh's hawkish Jackson Hole keynote, confirming the resistance zone flagged earlier this week.
• September rate-hike odds jumped to roughly 56% from about 35% a day earlier after Warsh said the Fed still has "work to do" on inflation.
• Myriad traders are still pricing Bitcoin's next major move at 77% for $84,000 versus 23% for $55,000, largely unmoved by Friday's selloff.

Bitcoin fell as low as $76,877 on Friday, giving up most of a double-digit weekly gain after Fed Chair Kevin Warsh's first Jackson Hole keynote warned that inflation isn't cooling fast enough.

The drop came from an overnight high of $81,455, inside the resistance zone that had already capped several prior breakout attempts this year. That zone held once again.

Warsh marked his 100th day in the job by declining to give markets any fresh guidance, but the tone was enough to move prices. In his keynote, Warsh set a standard for himself: the Fed needs to see inflation moving toward its target clearly and at sufficient speed before declaring the job done. Short of that, he said, the central bank still has "work to do."

Traders read that as hawkish. September rate-hike odds jumped to 55.7% from 35.4% a day earlier, according to the CME Group's FedWatch tool.