Ethereum, XRP, and Solana have dropped more than 6%: what now?

Bitcoin (BTC) has suffered a devastating slump, but altcoins have become the biggest victims of higher inflation figures from the United States. Ethereum (ETH), Ripple (XRP), and Solana (SOL), the market's largest altcoins, have each lost as much as 5 percent of their value.

Whether the decline continues depends again on what Bitcoin does now.

Yesterday, the Consumer Price Index (CPI) came in higher than expected on multiple fronts, and the crypto market is suffering significantly as a result. Bitcoin has already fallen by over 4 percent since the release at 14:30, but most altcoins have experienced a larger drop.

The total crypto market value reached a low last night around 04:00 and is now slightly more than 1 percent higher.

Ethereum was still above $2,500 at the time of publication and reached a low of $2,318 last night. That represents a drop of 7.90 percent.

This is also the lowest level since 20 August. And Ethereum has now even dipped below the range where it moved sideways for a long time in August and September.

A bright spot, however, is that a large hidden bullish divergence is visible on the chart. The price is still many times higher than in mid-August, while the Relative Strength Index (RSI) stands at a lower low.

This contrast shows that the selling pressure is now less powerful than the underlying strength of the broader upward trend. And that's good news for the entire altcoin market.

Ripple's XRP is performing slightly less poorly with a loss of about 7 percent.

And if we zoom out a bit, we see that the important support level around 1.30 dollars is doing its job for now.

Solana has fallen the least of the three, although it is all very close together. The seventh largest crypto has fallen by about 6.50 percent after the inflation figures.

The price has now almost arrived at a strong support where the big rally started last month.

Whether it results in a larger correction depends mainly on what Bitcoin is going to do now.

The price of the largest crypto currency is still above the previous breakout zone. That level has acted as resistance for a long time and is now trying to prevent a bigger carnage.

If Bitcoin closes below $81,000, it could drop further to $79,000 or even $77,000. And then things will get even tougher for altcoins.

New inflation figures in the form of the Producer Price Index (PPI) will be released this afternoon at 2:30 PM. Will the markets get some breathing room, or is another hit on the way?

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