- Bitcoin has dipped back under $113k USD, with traders showing more caution as September approaches.
- The upcoming Federal Reserve meeting will be closely watched, as an expected small rate cut could shape crypto’s short-term trajectory.
- Analysts suggest markets may already be looking ahead to 2026, when Trump is set to replace Jerome Powell as Fed Chair.
- Expectations of a more dovish Fed leader and stronger monetary easing under Trump could fuel a bullish crypto cycle well before the handover.
As Bitcoin slides back below $113k USD ($175k AUD), the market is in a state of flux. Following a push to new heights for several projects, it appears investors are leaning bearish as we look toward September.
A big date in September is the impending Fed Reserve meeting, where the FOMC will decide whether to cut interest rates or hold them steady. With most expecting a small rate cut, this decision could have significant impact on the medium-term trends of the crypto market.
However, according to one analyst, investors may begin casting their eyes even further into the future – 2026, when the US President Donald Trump will usher in Fed Chair Jerome Powell’s next-in-line.
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Trump vs Powell Heats Up (Again)
The current Federal Reserve, headed by Jerome Powell, has been notably hawkish on monetary policy over the past 12 months. Though they have cut rates, many in the United States believe they’ve been a little slow in enacting quantitative easing – starting with the President.
Trump has been outspoken about his distaste for Powell’s policies.
Regardless of whether you agree or not, Powell and Trump’s beliefs are two major factors in the short/medium-term performance of the crypto market.
Economist Alex Krüger, however, predicts the to-and-fro between the two figures is coming to an end, as Trump prepares to select Powell’s replacement for May 2026. And, given the US President’s strong position that monetary easing should come into play – sooner rather than later – Krüger argues that a bullish run could kick off as soon as the next Fed Chair is named.
Dovish Policies Set for 2026? Fed Chair Announcement Could Set the Tone
Specifically, the economist’s recent X post suggests that Powell’s successor will likely lead to a more dovish Fed Chair and a more aggressive QE policy in the second half of 2026.
And even though these changes are still nearly 12 months away, the market might react well in advance.
I have a high degree of confidence this cycle is not over because I am expecting changes in the Fed to bring on considerably more dovish monetary policy, which is not priced in at the moment; this would start to get priced in once Trump announces his nominee to replace Powell.
Economist Alex KrügerThere are currently 11 candidates Donald Trump is considering as Powell’s replacement.
But for now, crypto is in a bit of a holding pattern. Investors may have to wait until the September rate cut decision before digital assets break out of this consolidation phase – one way or another.
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