Liquidity for BTC is starting to dry up.
Analysts are pointing out that the Inter-Exchange Flow Pulse (IFP) is flashing warning signs, showing weakening liquidity between exchanges. More specifically, the Bitcoin IFP has turned red - this is a CryptoQuant metric that tracks flows between spot and derivatives exchanges. Historically, when this indicator goes red, it often comes before market corrections or even bearish phases.
 https://x.com/coinbureau/status/2000287173472629153?s=46&t=V07IM8b232m93jXsNncAog
 On top of that, Bitcoin reserves on exchanges have dropped to very low levels - around 2.76 million BTC as of early December 2025.  In this kind of environment, even relatively small trades can push price around hard - which is exactly what we’re seeing right now.

Sure, low exchange reserves are generally bullish long term (institutions accumulating, coins moving off exchanges, all that good stuff). But in the short term, a liquidity squeeze means choppy price action and a higher chance of getting positions wiped out - both longs and shorts.