Arsenal are not having much of a bad season, their performance in matches are valid enough to win them the Premier League trophy only that their top opponent is much more competent and only way they can outperform Manchester city is to ignite their potentials, any opportunity they have to lead the table they should enhance their game not to lose any more point because this has been their nightmare, leading the table for a long time then when it gets to the final stages of the league they will lose or share points which later puts them as the runner up meanwhile they had the whole opportunity to lead till the final match of that season. Arteta is doing a great job, I believe they have the potential to win the Premier league title even this coming season, they are among the favourites.
In my opinion, it looks like Arsenal still doesn't have something important that Man City has, that is the winning mentality. Arsenal might be able to play with confidence, toughness and has high motivation to always get victory but at the end of the season, they actually lost their consistency, where when they lost 0-2 against Aston Villa, though it was a home match for Arsenal. One defeat that ultimately made Arsenal fail to win the Premier League trophy. If Arsenal have a winning mentality, I'm pretty sure Arsenal will have the much-needed composure in that match, so there would be quite a big chance for them to turn things around.
You may be right. Arsenal may have lacked a bit of confidence. Manchester City had an erratic start to the season. The Manchester City team could not occupy the top spot in the table for a long time. At the top of the table we saw Liverpool and Arsenal. But in the end of season matches we saw Arsenal and Liverpool fall behind and Manchester City consistently won every match. And with a win in the last match, managed to grab the top spot in the table and clinch the title.
Arsenal's squad is strong. Coach Arteta has tried his best to strengthen Arsenal. But he failed. But I wouldn't say that Arsenal have performed poorly this season. If Arsenal can continue this kind of performance next season, they have a chance to win the title.