Bitcoin's Post-Halving Momentum: A Technical and Behavioral Deep Dive

Bitcoin's post-halving narrative in 2025 has unfolded with a blend of optimism and caution, driven by tightening supply dynamics, robust on-chain activity, and evolving institutional participation. The 2024 halving, which reduced daily issuance to 900 BTC, has created a supply shock that aligns with historical patterns of scarcity-driven price surges. However, technical and behavioral indicators now suggest a nuanced landscape: while the fundamentals remain bullish, early signs of overbought conditions and divergences in momentum metrics warrant careful scrutiny.

On-Chain Metrics: A Supply-Driven Bull Case

The post-halving environment is characterized by extreme hoarding, with 74% of Bitcoin's circulating supply illiquid (not moved in two years or more) and 75% dormant for over six months, according to an XT analysis. This reduced float creates upward pressure on BTC/USD prices, as demand outpaces the constrained supply. On-chain metrics like the Network Value to Transactions (NVT) golden-cross at 1.51 and active addresses (735,000) reinforce usage-driven value, a theme highlighted in that analysis.

Holder behavior further underscores conviction: realized capitalization exceeds $900 billion, the SOPR ratio (1.03) indicates breakeven or minimal profit-taking, and the MVRV ratio of 2.3× shows long-term holders are up 230% (as noted in the XT analysis). Exchange outflows, particularly at major platforms like Binance, have tightened liquidity, with reserves dropping from 595K to 544.5K BTC, signaling accumulation by institutions and whales, a trend the XT analysis documents.

Technical Indicators: Momentum vs. Divergence

Bitcoin's price in October 2025 has surged past $124,682, breaking through key resistance levels and consolidating gains within a new range, according to an Aurpay analysis. The MACD histogram remains strong, with the line above its signal line, reinforcing the uptrend described in that Aurpay analysis. However, bearish divergence on the weekly MACD and RSI nearing overbought levels (70–90 on the four-hour timeframe) suggest caution, as noted in a SpotedCrypto review.

The RSI, currently at 44.63, is in a neutral range but has shown volatility, with readings near 70 in mid-October indicating strong momentum, a point raised in the Aurpay analysis. The price remains above key rising EMAs, a bullish sign, but a breakdown below $117,900 could trigger a deeper correction, as the SpotedCrypto review warns.

Behavioral Analysis: Greed and the Risk of Overextension

Retail sentiment, as measured by the Fear & Greed Index, has shifted into "Greed" territory, reflecting optimism about Bitcoin's role as a hedge against macroeconomic uncertainties like the U.S. government shutdown and Fed rate cuts, according to a FinancialContent article. However, historical patterns show that extreme greed (above 75) often precedes corrections, as seen in 2017 and 2020, according to a HyroTrader analysis.

Social media sentiment and the SOPR ratio (1.03) suggest selective profit-taking, but long-term holders remain anchored to the supply shock narrative described in the XT analysis. The challenge lies in balancing short-term volatility with the broader bullish thesis of tightening supply and institutional adoption.

Historical Context: Lessons from Past Halvings

Comparing current conditions to past halvings (2012, 2016, 2020) reveals critical differences. After the 2020 halving, Bitcoin peaked at $69,000 before a 78% correction, driven by an MVRV ratio above 3.5 and RSI overbought levels, according to an XS prediction. In contrast, the current MVRV ratio of 2.3× is below historical correction triggers, suggesting the market is not yet overextended, a point also emphasized in the XT analysis.

However, the RSI's proximity to overbought territory and bearish MACD divergence mirror pre-2020 correction signals. The key distinction lies in institutional participation: ETF inflows and regulatory clarity (e.g., CLARITY and GENIUS Acts) have created a more resilient market structure, as the XT analysis notes.

Strategic Implications for Investors

For new investors, the current environment offers a high-conviction entry point, supported by on-chain strength and institutional inflows. However, the risk of a short-term pullback (e.g., to $120,000–$121,000) necessitates disciplined position sizing and stop-loss placement.

Existing investors should consider partial profit-taking if Bitcoin tests $125,708, a critical resistance level. The broader bull case remains intact if the price holds above $117,900, with the S2F model projecting a $248K–$369K range, as described in the XT analysis.

Conclusion

Bitcoin's post-halving momentum in 2025 is underpinned by a unique confluence of supply constraints, institutional adoption, and macroeconomic tailwinds. While technical indicators like RSI and MACD divergence hint at near-term volatility, the on-chain fundamentals and historical cycles suggest a continuation of the bullish trend into Q4 2025. Investors must balance optimism with caution, leveraging technical and behavioral signals to navigate the next phase of BTC's cycle.