Rebol/View, 284 266 bytes

rebol[]p: 3x9 d:[3 3]view layout[b: box blue 99x99 effect[draw[circle p 2]]rate :0.01 feel[engage: func[f a e][if a = 'time[case/all[p/x < 2[d/1: abs d/1]p/y < 2[d/2: abs d/2]p/x > 98[d/1: negate d/1]p/y > 98[d/2: negate d/2]]p/x: p/x + d/1 p/y: p/y + d/2 show b]]]] 

Ungolfed:

rebol [] p: 3x9 ;; starting position d: [3 3] ;; direction view layout [ b: box blue 99x99 effect [ draw [ circle p 2 ] ] rate :0.01 feel [ engage: func [f a e] [ if a = 'time [ case/all [ p/x < 2 [d/1: abs d/1] p/y < 2 [d/2: abs d/2] p/x > 98 [d/1: negate d/1] p/y > 98 [d/2: negate d/2] ] p/x: p/x + d/1 p/y: p/y + d/2 show b ] ] ] ]