Ethereum, XRP, and Solana Technical Analysis Following US Inflation Data

Ethereum (ETH), XRP (XRP), and Solana (SOL) posted modest gains after the latest United States inflation report. Still, technical indicators show downside risks for all three altcoins in the short term.

What Was in the Latest U.S. Inflation Report?

U.S. U.S. inflation rose more than expected in September, interrupting the recent trend of moderating price pressures.

The core consumer price index (CPI), which excludes volatile food and energy prices, increased by 0.3% for the second consecutive month, according to data from the Bureau of Labor Statistics released on Oct. 10. That brought the three-month annualized core inflation rate to 3.1%, the highest since May.

Economists often consider the core CPI a more reliable underlying inflation gauge than the headline figure. The overall CPI, which rose by 0.2% in September, was driven primarily by housing and food, contributing over 75% of the increase.

Traders in swaps markets are now anticipating a 25-basis-point rate cut in November as policymakers face the challenge of managing inflation without significantly affecting the job market. Lower interest rates typically boost cryptocurrencies and other risk assets.

Still, the ongoing Middle East conflict has increased demand for safer assets, driving up the U.S. dollar. In the short term, that could weigh negatively on the top altcoins, primarily Ethereum, Solana, and XRP.

Ethereum (ETH) Technical Analysis

Ethereum Daily Chart — ETH is Nearing a Head-and-Shoulders Breakdown

As of Oct. 11, Ethereum was trading for around $2,410, following a slight recovery after the inflation data release. The cryptocurrency’s daily chart reveals a classic head-and-shoulders pattern, a bearish signal that could lead to a drop toward the $2,028 support level.

This target—determined by adding the pattern’s maximum height to the potential breakdown point—aligns with the August support area.

Resistance levels are the 50-day exponential moving average (EMA) at $2,533 and the 200-day EMA at $2,817. These could further hinder Ethereum’s attempt to bounce back.

Ethereum Weekly Chart — Uptrend Will Likely Resume in 2025

Ethereum’s weekly chart supports a decline toward the head-and-shoulders target discussed above, given it coincides with a multi-year ascending trendline support and the 200-week exponential moving average (200-week EMA; the blue wave).

Nonetheless, ETH has bounced multiple times from the said support confluence. For instance, its retest in October 2023 followed a 170%-plus price rally, reaching the multi-year horizontal trendline resistance at around $4,000.

That said, ETH’s price will likely rebound toward $4,000 in early 2025.

XRP Technical Analysis

XRP Daily Chart — Bear Flag Signals Massive Selloff Ahead

As of Oct. 11, XRP was trading for around $0.535, gaining some ground after the U.S. inflation report. However, the daily chart shows a potential bear flag formation, a bearish continuation trend confirmed by two upward-sloping, parallel trendlines that form after a sharp downtrend.

A bear flag technically resolves when the price breaks below the lower trendline and falls by as much as the height of the previous downtrend. Applying the same principles on the XRP daily chart brings its downside target for 2024 to $0.465, down by over 13% from the current price levels.

XRP Weekly Chart — Holding Above Key Supports But…

XRP/USD weekly chart highlights a symmetrical triangle pattern, defined by converging trendlines that represent the asset’s consolidation since its peak in April 2021 near $1.96.

As of Oct. 11, XRP was trading near the triangle’s upper trendline, around $0.53, while holding above its 50-week and 200-week EMAs. In other words, the cryptocurrency is rangebound, eyeing a break below the EMAs to pursue a clear downtrend toward the triangle’s lower trendline.

That said, if XRP faces further rejection from the upper trendline, it could initiate a pullback toward the lower trendline, currently near $0.40, aligning with the 0.618 Fibonacci retracement level of the broader upward move from the March 2020 low of $0.14 to the April 2021 high.

The bearish case strengthens if trading volume remains low, suggesting a lack of conviction among bulls. Thus, unless XRP manages a strong breakout above the upper trendline, the path of least resistance may lead to a decline toward the triangle’s lower boundary.

Solana (SOL) Technical Analysis

Solana Daily Chart — Head-and-Shoulders Suggest a 20% SOL Crash

Solana trades at roughly $140.80, showing some strength after the inflation report, but its chart also features a head-and-shoulders pattern. The neckline rests around $128, a key support level. If the price breaks below this, Solana could slide toward $116, which aligns with the lower boundary of a descending channel.

Resistance comes from the 50-day EMA at $143.92 and the 200-day EMA at $140.76. The RSI at 46.86 shows mild bearish momentum, though the market hasn’t tipped too far in either direction. Bulls must push Solana back above $150 to invalidate the bearish setup and regain control.

Solana Weekly Chart — Sharp Bearish Reversal A Likely Outcome

The weekly chart of Solana shows a clear descending triangle pattern, typically considered a bearish continuation signal.

The pattern has formed over several months, with a series of lower highs indicating diminishing buying pressure. Horizontal support near $125 keeps the price from breaking down.

If Solana breaks below the horizontal support, the downside target would be around $76, aligning with the triangle’s height projected downward from the breakout point.