Bitcoin: Towards the end of the bullish cycle? Fidelity revises its medium-term forecasts

Fidelity Digital Assets, a crypto investment giant, has recently revised its medium-term outlook for Bitcoin downward. While the firm remains optimistic for the short term, several indicators suggest that the king of cryptos has lost some of its luster.

A Bitcoin that is no longer “cheap”

According to the latest Signals report published on April 22 by Fidelity, several indicators suggest that Bitcoin is no longer in an attractive buying zone. The Bitcoin Yardstick, a ratio used to determine if the cryptocurrency is oversold, showed “no days in the first quarter where BTC was considered undervalued.”

Furthermore, other technical and on-chain signals corroborate this analysis. Long-term hodlers contribute to selling pressure, while 99% of Bitcoin addresses are in profit, which could trigger profit-taking.

Metrics such as NUPL (Net Unrealized Profit/Loss) and MVRV Z-Score confirm this trend, indicating that BTC is trading at a level close to its intrinsic value.

Intact bullish potential for the short term

Despite this bearish revision, Fidelity maintains a bullish outlook for Bitcoin in the short term. Several technical elements support this vision:

• The Bitcoin price remains above its 50 and 200-day moving averages, confirming a bullish momentum.
• On-chain indicators are far superior to the lows reached during previous market cycles.
• The realized price, representing the average cost of current holders, is established at $28,000 and has been a solid support since mid-January.

Moreover, accumulation continues among small investors. Wallets holding over $1000 in BTC have jumped 20% since January, reaching record levels. Balances on exchanges are also decreasing, reducing selling pressure.

Bitcoin has been trading in a price range since February, fluctuating between $60,000 and $72,000. However, the recent halving propelled its price by 5%, allowing it to reach a 10-day high of $66,863.

Chris Kuiper, head of research at Fidelity, emphasizes that the market is still far from historic highs. According to him, “we are halfway through the cycle, and historically, the bulk of the price increases occur in the second half of the cycle.” This gives cause for continued hope for what is to come.