Jackson Hole Countdown: Is Bitcoin Ready for a Potential Powell Shock?

Bitcoin Faces Modest Volatility Ahead of Powell’s Jackson Hole Remarks

All eyes are on Federal Reserve Chair Jerome Powell’s upcoming address at the Jackson Hole Economic Policy Symposium on Friday — and while anticipation is high, markets are expecting only moderate volatility for Bitcoin in response.

According to Pulkit Goyal, head of trading at crypto options specialist Orbit Markets, Bitcoin options are currently pricing in a move of around ±2.0% surrounding the speech. “Despite the attention, options markets are not bracing for extreme price swings,” Goyal told CoinDesk.

Implied volatility — a metric derived from options pricing — reflects the market’s expectations for price movement. Volmex’s one-day implied volatility index (BVIV1D) has climbed to 49% annualized, the highest since May 26. That suggests a potential 24-hour price fluctuation of approximately 2.5%, higher than Bitcoin’s average daily change of 1.18% over the past month.

It’s important to note that implied volatility is direction-neutral. While markets are positioning for movement, that doesn’t indicate whether prices will rise or fall.

However, some traders are hedging against a more balanced — or even hawkish — message from Powell, rather than the dovish tone many are hoping for. “If Powell’s tone isn’t clearly supportive of rate cuts, we could see a pullback in Bitcoin,” Goyal explained. “We’ve seen increased demand for downside protection, with 25-delta risk reversals now favoring puts by 6 volatility points.”

That risk-off sentiment suggests investors are preparing for Powell to push back on aggressive easing expectations, which could weigh on crypto assets in the short term.

Powell is set to deliver his remarks Friday morning, with traders closely watching for any macro signals that could shift sentiment across the digital asset space.