The Federal Reserve (FED) is about to cut interest rates, and the crypto market may usher in a new opportunity for a pump.

Recent economic data show that the U.S. job market is cooling and inflation is declining, creating conditions for The Federal Reserve (FED) to cut interest rates. The chairman of the FED clearly stated in his latest speech that a new round of interest rate cuts is about to begin. This indicates that global liquidity may enter a new expansion period, bringing good news for the asset market.

Unlike the emergency interest rate cuts in 2020 due to the pandemic, this time the rate cut is preventive in nature, aimed at guarding against potential economic risks. Historical experience shows that preventive interest rate cuts often do not trigger bear markets, but rather may lead to bullish market conditions. The current market expects the Federal Reserve to cut interest rates by 25 basis points in September.

In August, global stock markets experienced significant fluctuations. The Nikkei 225 index once plummeted by 12.4%, but subsequently, the global market gradually stabilized and rebounded. The Dow Jones Industrial Average, one of the three major U.S. stock indices, even reached a new high. This reflects that during the period of the Federal Reserve's policy shift, investor sentiment is quite sensitive, but overall remains optimistic.

As a representative of technology stocks, Nvidia's latest financial report exceeded market expectations, yet its stock price still experienced a pullback. This indicates that investors are starting to downplay the AI theme and are turning their focus more towards macroeconomic factors. Currently, we are at a turning point in monetary policy, and there is uncertainty in the short-term market trend.

The cryptocurrency market performed relatively sluggishly in August. Bitcoin's price briefly fell below $50,000 and is currently hovering around $60,000. The number of addresses holding large amounts of Bitcoin decreased earlier but has started to rebound in August, indicating that some funds are seizing the opportunity to accumulate. In contrast, Ethereum's performance has been weaker, with the ETH/BTC exchange rate hitting a new low since 2021. This is mainly influenced by Grayscale's continued selling.

Industry insiders believe that as the Grayscale sell-off comes to an end, the second half of this year may be a good opportunity to accumulate Ethereum. Investors should pay attention to the ETH/BTC exchange rate changes and wait for the right entry timing.

Overall, the upcoming interest rate cut cycle by The Federal Reserve (FED) is expected to bring a new wave of pump momentum to the crypto market. The value of Bitcoin as an inflation hedge tool will further stand out. Oversold assets like Ethereum may also welcome a strong rebound. Investors should seize macro changes and position themselves accordingly, while also being mindful of risk management.