Bitcoin is showing tentative signs of recovery after a turbulent weekend, edging higher as traders unwind bearish positions and institutional investors signal continued confidence.
As of Monday, the world’s largest cryptocurrency is trading near $87,600, a modest rebound from its $85,550 weekend low, according to CoinGecko data.
On-chain analytics firm Glassnode reported that selling pressure (though still elevated)appears to be losing strength. Analysts noted that derivatives positioning, spot flows, and ETF activity collectively point to a market shifting from panic-driven exits to more controlled risk reduction.
A subtle rise in the spot cumulative volume delta, along with a flattening Coinbase premium, suggests incremental spot buying and a slowdown in aggressive sell orders, a dynamic often viewed as an early sign of stabilization.
Options Market Turns Less Bearish
The derivatives market is also flashing a more constructive tone. Traders who had previously loaded up on protective puts as Bitcoin briefly revisited the $80,000 zone have eased off. The 25-delta skew, a widely watched sentiment gauge, sharply rebounded from -10.96 to -4.58, hinting that fears of deeper declines are starting to recede.
Data from analytics firm Laevitas highlighted a jump in call option activity across strike prices between $100,000 and $118,000, including several Long Call Condor block trades—an advanced strategy typically used by traders positioning for moderate gains within a defined range later in the year.
A Rally With Conditions
Still, analysts caution that Bitcoin has significant technical hurdles to clear. To turn the current bounce into something more durable, the asset must reclaim the $87,000–$88,000 zone, said Ryan Yoon, senior analyst at Tiger Research in Seoul.
Trading below this band, he warned, keeps the move classified as a “relief rally” with limited room for upside, especially as many investors remain underwater.
Institutions Stay Steady
Despite short-term uncertainty, long-term players appear largely unfazed. Bitwise CIO Matt Hougan said in a Monday post on X that institutions remain “patiently bullish,” citing a recent call with a major advisory firm overseeing roughly $50 billion in assets.
Eyes on the Fed
Bitcoin’s recent weakness hasn’t fully dissipated. The cryptocurrency is still coming off its fourth straight weekly decline (its longest losing streak since mid-2024) and its current fourth-quarter performance is tracking as its weakest since 2018.
With key macroeconomic data on the horizon and the Federal Reserve’s December interest rate decision looming, traders widely expect volatility to pick back up. Whether Bitcoin’s latest bounce marks a true turning point, or just another brief reprieve, may hinge on how those catalysts unfold.
