The Fidelity Signals Report published in the first quarter of 2025 indicates that Ethereum's current market value may be below its potential. According to the report, technical indicators and network data offer important clues that investors should not overlook.

Indicators Signal Buying Opportunities

Fidelity emphasizes that Ethereum's price has declined by 45% since the peak in January, noting that a classic 'death cross' signal was formed when the 50-day simple moving average fell below the 200-day average in March. While this technical structure gives weakness signals in the short term, some indicators highlight strong potential in the long term.

Especially the MVRV Z-Score indicator hovering around -0.18 suggests that Ethereum's market price is below its true value. This metric is one of the tools used by many analysts to identify 'bottom regions'. Therefore, this value is interpreted as a hopeful signal that Ethereum is currently undervalued.

Additionally, Ethereum's market value ratio against Bitcoin is also at notable levels. This ratio, which was close to values seen in 2020, began a downward trend from the end of 2022 and has continuously weakened over the last 30 months. This situation is a strong sign that Ethereum has shown weak performance against BTC.

Network Activity and Technical Improvements

The report also details user interactions on the Ethereum network. Notably, there have been significant increases in interaction numbers with the growth of Layer-2 solutions. By the end of the first quarter of 2025, the total number of users interacting with the network reached a record of 13.6 million. This increase is seen as a positive signal indicating the deepening infrastructural strength of Ethereum.

Another noteworthy development is Ethereum's rise above the 12-hour Ichimoku Cloud indicator. This technical signal stands out as a promising indicator that a bullish trend might begin. Observing such a technical improvement for the first time since December 2024 may be encouraging for investors.

The Fidelity report also included the Net Unrealized Profit/Loss (NUPL) ratio. The fact that this indicator is hovering around zero at the end of the first quarter indicates that the market is under intense selling pressure. This means that most investors are neither in profit nor in loss; this could indicate that the market is in a neutral or even slightly hopeless region.

The deterioration of the macroeconomic environment is also among the warnings given to investors in the report. External factors such as global economic uncertainties, interest rates, and regulatory risks are mentioned as potential pressures on Ethereum's price in the short term. Therefore, Fidelity emphasizes that investors need to be prepared for short-term volatility.

Looking at the overall framework of the report, it is stated that Ethereum's long-term potential is still strong, but short-term risks should not be overlooked. In other words, Ethereum may be close to bottom levels; however, this does not mean that the path will flatten out at any moment.