Supply and demand

From early July to mid-September 2025, bitcoin balances on exchanges somewhat reversed from a clear downward trajectory in earlier months, increasing from ₿2.942 million to around ₿2.968 million according to Glassnode. This rollercoaster effect throughout the quarter was mainly due to profit-taking in mid-August, when the price reached a new all-time high, while geopolitical tensions around the world also had an effect.

Bitcoin is flowing out of exchanges, which is a positive long-term signal of reduced liquid supply. Since the price hasn’t reacted explosively, demand is steady but not aggressive. If demand meaningfully picks up while balances keep falling, the setup tilts strongly bullish.

Price-wise, bitcoin gained overall in Q3 except for the selloff after reaching the all-time high in August, growing from around $105,000 to the current $117,000, showing resilience even as liquidity on exchanges tightened. This divergence, when falling exchange balances pair with stable or rising prices, often shows strong demand in combination with limited immediate supply, setting the stage for upward pressure if demand remains similar.

Bitcoin’s hashrate continued to climb in the third quarter of 2025 even as prices dipped. This divergence between hashrate and price suggests persistent resilience in mining activity despite volatility:

1. Network health is improving – a higher hashrate means stronger security and more confidence in the system in the long term.
   
   
2. Miners’ margins are tightening – if the price isn’t rising with the hashrate, block rewards are split across more miners, forcing efficiency and eventually pushing weaker miners out.
   
   
3. Potential sell pressure – when margins compress, miners often need to liquidate more bitcoin to cover operating costs. That can create extra supply on the market, capping the price in the short term.

Sentiment from the Fear and Greed Index has calmed down after profit-taking in August and shifted from greed at the beginning of the quarter to neutral, around 73% to the current 52%.Anticipation of the Fed cutting rates until the end of the year holds for now and could be affecting sentiment for bitcoin.

According to the CME FedWatch, the probabilities for the next meeting in October are another cut to 3.75-4% with a chance of around 90%, while the probabilities of another cut in December meeting are at 82% at the time of writing.

Technical view

Bitcoin maintained a rally in the first half of last quarter before correcting mainly due to profit-taking activity and has rebounded in for the month to 19 September. The stochastic signals overbought while Bollinger Bands are still quite expanded, showing that volatility might support a significant move to either direction. On the other hand, the 50-day SMA is still above the 100, validating the short-term uptrend. Even if there is a retracement lower, as the stochastic might suggest, the overall uptrend is valid until the moving averages cross each other.

If there’s a correction, the first area of possible support might be around $114,000, which is the 38.2% weekly Fibonacci retracement and the dynamic support between the 50 and 100 SMAs plus an area of reaction since late August. The second potential support might be the medium-term low of $108,000 that was tested in early September. On the other hand, if the recent gains continue, $120,000 might be retested, as it's the 78.6% weekly Fibonacci retracement and the area that the price failed to break in July.