Bitcoin hovers amid high implied volatility; "rocket-like surge" has become a luxury.

Entering the Asian trading session on November 26, Bitcoin fluctuated around $87,000, attempting to consolidate recent gains. Although AI optimism provided short-term support, market expectations for the year-end rally have been gradually eroded by reality. The positioning of options traders reveals a clear signal: limited upside potential, and the “rocket-like” frenzy is no longer anticipated.

Meanwhile, Ethereum followed the rotation of funds slightly higher, maintaining around $2,900. As traders tend to favor assets with clearer catalysts, Ethereum remains relatively strong, while Bitcoin’s upward momentum appears weak.

AI Sentiment Fluctuates, Macro Winds Are Weakening

The news that Amazon pledged to invest $50 billion in U.S. AI and supercomputing infrastructure once ignited market optimism, especially stimulating miners shifting toward AI infrastructure. However, this enthusiasm quickly cooled—NVIDIA dropped 6% on Tuesday, exposing the fragility of such logic.

Market maker Enflux pointed out that once the AI sector loses support, the previous correlation effects will be difficult to sustain. “Before NVIDIA stabilizes, Bitcoin’s upside will continue to be limited by risk budgets,” the firm said. “When AI stocks wobble, the crypto market loses one of the few long-term growth correlations for 2025.”

After risk sentiment weakened, funds did not flow into Bitcoin as a safe haven as expected. Instead, liquidity dispersed into more attractive sectors such as Solana, Ethereum, DePIN, GPU computing, and tokenization. Bitcoin’s dominant position did not surge; rather, there was a pattern of capital outflow.

Options Traders Bet: Mild Upside, No Explosive Rise

Options market trading patterns directly reflect changing market sentiment. There was a large nominal value of about 20,000 BTC in bullish call spreads on Deribit, betting that Bitcoin will settle between $100,000 and $118,000 at December 2025 expiry. This strategy is typical for investors expecting an upward move but believing the gains will be limited.

Wintermute OTC trader Jake Ostrovskis candidly said, “The market’s previous consensus on a year-end ‘Santa rally’ has been completely priced out.” Recently, there has been a noticeable increase in large bullish call spread trades, exemplifying this shift.

“Implied volatility has decreased, the term structure has normalized futures contango, and skew has returned to neutral,” Ostrovskis noted. These are key signals that the market may be truly bottoming out, especially important for traders trying to precisely catch the bottom.

Implied Volatility Remains High, Panic Still Lingers

Adam Chu, head of research at GreeksLive, an options analysis firm, said that the expectation of new highs in Q4 has vanished, and market sentiment has turned bearish. Bitcoin rebounded slightly from weekend lows, currently fluctuating around $87,600, up about 2.5% from the weekend low of $85,550, but this is not a sign of a stable trend.

Glassnode’s report indicated that selling pressure has indeed decreased, although it remains oversold, showing signs of fatigue. However, stable holdings, light spot trading, and ETF outflows suggest the market is merely shifting from extreme panic to neutrality—not a confirmed bottom.

More concerning is the behavior of implied volatility (IV). Derive research head Sean Dawson pointed out that despite price stabilization, 30-day and 180-day implied volatilities are still rising, indicating traders are still willing to pay premiums for “fear protection.” This suggests uncertainty and fear have not truly dissipated.

Volatility Structure Reversal Is a Bottom Signal

The current volatility term structure is in a “reverse market”—short-term implied volatility exceeds long-term volatility, a typical sign of high market tension. Only when the market shifts back to a “forward market,” with higher long-term implied volatility, can it indicate genuine stabilization.

Since the flash crash on October 10, skew has been deeply negative. Although it has slightly recovered over the past week, Dawson emphasized that “there is still a long way to go before skew truly reverts to neutral,” and the complete disappearance of bearish sentiment will take time.

Chu added, “Although key indicators have recently declined, market panic has not fully subsided. Year-end remains risky, and implied volatility expectations are still high.”

Conclusion: Steady Rise, Not Explosive Rebound

Based on multiple signals, professional traders are preparing for continued volatility and a non-linear rebound, with the market lacking consistent strong upward confidence. Dawson predicts Bitcoin will remain in the $100,000 to $118,000 range for the rest of 2025, with a breakout above $120,000 more likely to occur next year or later.

This is not a pessimistic outlook but an honest assessment of risks. With implied volatility still elevated and the volatility term structure not fully restored, the market is building a more stable but slower upward trajectory—an exponential surge is no longer on the agenda.