Treasury yield slide helps Ethereum recover $2,400 level

Key takeaways

• After US producer inflation ran hotter than forecast, Ethereum dipped briefly toward $2,340 before climbing back above $2,400.
• September PPI rose 6.3% from a year earlier, while core PPI came in at 5%, with both readings ahead of projections.
• Support sits near $2,355, while resistance between $2,496 and $2,552 may test the rebound.

Ethereum bounces back after producer inflation data

On Friday, Ethereum climbed back past $2,400. It had briefly fallen toward $2,340 after US wholesale inflation data arrived stronger than anticipated.

September's PPI was up 1.3% from August and 6.3% year over year, topping the respective forecasts of 0.5% and 5.3%.

Core PPI, which strips out food and energy costs, also came in above expectations at 0.7% for the month and 5% on the year, against projections of 0.3% and 4.4%.

The data came on the heels of Wednesday's stronger-than-expected CPI release, heightening unease over stubborn inflation and what it means for monetary policy.

At first Ethereum fell in line with other risk assets, but it turned higher as Treasury yields and the dollar pulled back.

The losses were concentrated among traders who had bet on higher prices, underscoring how leveraged positions came under strain during the drop. When falling prices eat into collateral, forced liquidations can add to the selling pressure.

The data reflects a complete 24-hour span, capturing the volatility tied to the inflation releases rather than only the initial response to Thursday's PPI.

The recovery in Ethereum came alongside a drop in the US 10-year Treasury yield to 5.095%, its lowest mark since September 22.

The lower yields helped relieve some of the pressure on Ethereum that had built up when inflation drove borrowing-cost expectations higher.

The US Dollar Index, for its part, gave back the ground it had gained after CPI and slipped to roughly 102.04 as of writing.

Yields and the dollar moving lower together created a friendlier environment for the wider cryptocurrency rebound, although worries about inflation have not gone away.

Ethereum holds $2,355 support, with resistance still ahead

On the daily chart, Ethereum bounced off the vicinity of its 100-day EMA at $2,356 and the $2,355 horizontal support level after briefly trading below that area.

Buyers are now trying to keep the recovery going above $2,411. Momentum indicators have strengthened a bit.

The RSI ticked higher to 40.9, and the Stochastic Oscillator was close to 25. Those readings point to a softening of the immediate bearish pressure, but they stop short of signaling a confirmed reversal.

Resistance on the way up starts with the 50-day EMA at $2,496. Just past that, the $2,548 horizontal level and the 20-day EMA at $2,552 sit close together as a barrier.

A move back above that zone would bolster the near-term rebound case. Below, the 2,355–2,356 region stays significant. If the daily candle closes under it, support at $2,204 could come into play, with $1,971 and then $1,827 at risk should the selloff extend.