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Bitcoin is heading toward its toughest quarter in years as the market struggles to stabilize following a prolonged downturn. The world’s largest digital asset has now recorded four consecutive weekly losses—its longest slide since June 2024. Even with a small weekend rebound, analysts warn that traders could still face turbulence before conditions improve.
Longest Weekly Decline in Over a Year
Bitcoin’s recent drop has pushed its fourth-quarter performance toward what could become its worst showing since 2018. The asset is currently down more than 24% this quarter, underscoring the intensity of selling pressure across the market.
“I expect a rough ride into Christmas,” said Sean Dawson, head of research at Derive, speaking to Decrypt. His view reflects the cautious tone seen across both derivatives and spot markets as investors brace for continued volatility.
Despite the broader weakness, Bitcoin has clawed back some losses. It is trading near $87,400 after bouncing from a November 21 low of $82,100, according to CoinGecko.
Key Spot Metric Shows Signs of Dip-Buying
Even as price action remains fragile, on-chain data provides a subtle hint of underlying demand. The aggregate spot bid–ask delta at 10% depth—a metric used to gauge buy-side interest—has surged to its second-highest level of 2025.
This indicator measures whether deep liquidity on spot markets is favoring buyers or sellers. A spike typically suggests strong bids absorbing sell pressure. The last time this metric sharply increased after a sustained downtrend, in March and April, Bitcoin formed a bottom that led to a 64% rally in the months that followed.
This current rise does not guarantee a reversal, but analysts say it indicates that buyers are actively stepping in at lower levels.
Options Traders Position for More Downside
While spot buyers are accumulating, derivatives traders remain defensive. Dawson highlighted that options market positioning shows a heavy build-up of protective puts—especially for the December 2025 expiry. Many contracts are clustered between $80,000 and $85,000, revealing expectations of further short-term weakness.
A negative skew in the options market reinforces this sentiment, suggesting traders are paying a premium to guard against deeper declines.
“I wouldn’t be surprised if Bitcoin briefly slipped into the mid to high $70,000 range,” Dawson said, adding that the asset could still recover to near $90,000 by year-end—assuming no hawkish shift from the Federal Reserve.
Federal Reserve Repricing Supports a Short-Term Lift
The recent bounce aligns with a significant shift in expectations for the Federal Reserve’s December policy meeting. Odds of an interest rate cut have jumped from 40% last week to nearly 70%, fueling some optimism across risk markets.
Still, analysts warn the road ahead may not be smooth. Dawson said concerns over “sticky inflation” could slow the transition to easier monetary policy—delaying the liquidity conditions needed to support a strong Bitcoin recovery.
Market watchers are closely tracking two pivotal Fed decisions:
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End of quantitative tightening on December 1
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Interest rate decision on December 10
Both events could heavily influence Bitcoin’s trajectory heading into the first quarter of 2026.
Digital Asset Treasuries Under Pressure
The ongoing downturn has hit digital asset treasury stocks particularly hard. Many firms holding substantial reserves of Bitcoin and Ethereum have seen their shares trade below net asset value, limiting their ability to increase holdings or capitalize on volatility.
Recent market turbulence wiped out nearly $1 billion in liquidations in a single hour as Bitcoin briefly dipped below $82,000. This strain is reflected across multiple ETFs as well, with many spot Bitcoin and Ethereum funds trading in the red amid declining sentiment.
These pressures have contributed to the cautious stance of institutional traders, who have scaled back risk exposure until stronger confirmation of market stabilization appears.
A Potential Bottom Forming—But Bull Trap Risk Remains
While spot accumulation metrics show promise, analysts remain divided on whether a true market bottom is forming. Some suggest Bitcoin may stage a short-term recovery that ultimately turns into a bull trap—a temporary uptick that lures buyers before another sell-off.
Dawson believes the year-end outlook remains challenging but expects Bitcoin to reach $100,000 by the first quarter of 2026, assuming the macro environment improves and fear-driven selling eases.
Market sentiment remains stuck in “extreme fear”, though recent upward movement has softened the negative outlook slightly.
Outlook: All Eyes on December
Bitcoin now stands at a crucial juncture. Key factors shaping the next few weeks include:
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Fed policy direction
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Liquidity conditions across global markets
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Options market positioning
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Institutional demand levels
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Potential for a washout into the $70,000 range
If the Federal Reserve avoids a stricter stance in December, Bitcoin could stabilize and move toward $90,000 by year-end. If not, traders may face more turbulence before a clearer path to recovery emerges.
