Research Study
Q1 2024 Signals Report
A quarterly breakdown of key market metrics that could be affecting price and investor sentiment
by Fidelity Digital Assets
April 22, 2024 • 30 min read
Executive Summary
As of the end of Q1 2024, the data suggests some potential for short-term profit-taking, but no extreme indicators that are commonly seen during bull market peaks.
Bitcoin, up roughly 62% in Q1, has maintained its positive price signals as it has remained above its short- and long-term moving averages. We also continue to see bitcoin leaving exchanges as the market saw a 4% reduction in Q1. However, some long-term holders’ net positions have continued to fall. The high fee environment has gone, but increased spot prices combined with the upcoming halving continue to incentivize miners to take profits. Therefore, miners remain a notable portion of the current sell pressure. Some regulatory relief has been found with the approval of numerous spot bitcoin exchange-traded products.
Ether, up roughly 55% in Q1, has also seen short-term positive price signals and growing on-chain metrics which we ostensibly attribute to the Deneb-Cancun upgrade that occurred on March 13. The Ethereum network has continued to maintain a higher rate of burn than issuance, resulting in nearly 450,000 ether being removed from the network since The Merge’s implementation in September 2022. The number of validators staking on the network has increased 8% since January, which was the same rate of growth seen in Q4 2023.
Read more to learn what metrics we are watching and what they may be telling us.
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