A -15.82% week forces a weekly trend rebalance into thin volume and a 5.55% hour off the low
Should the fund let the new down signal set its full short size at this week's rebalance, or scale it down until volume and intraday follow-through confirm?
The market facts are real; the decision maker is illustrative.
The week and the position
In the week of 12 November 2018, ETH fell from 212.60 to 178.97 (-15.82%), closing 18.5% up the week range, in the lower third. The high printed at Monday's open (214.22) and the low at Thursday 14:00 UTC (170.99), with the week's largest 1-hour move, 5.55%, one hour later at 15:00 UTC. The worst day was Wednesday (-10.68%), the best Sunday (+1.57%). Dollar volume of 0.3bn was 0.62 times the prior 12-week average. The prior four weeks were +5.41, -1.19, +3.47, +0.19, three up and one down. ETH lost 3.59 points against BTC, and hourly correlation to BTC was 0.83.
Judgment
This week's -15.82% lands in the 15th percentile of the 39 weeks of ETH history, and the rebalance should take the short the signal implies. Size it below full weight: the decline carried 0.62 times the prior 12-week average volume, and the week's largest 1-hour move, 5.55%, printed at 15:00 UTC, one hour after Thursday's low, so a single hour could carry that much range at the week's turning point. Annualised realised volatility of 91.4% and a 25.28% range argue for the same restraint. Accept a slower entry in exchange for avoiding a full-size position built on a week whose volume was well below its recent norm.
What would change it
If a following week closes back above the 212.60 open with volume at or above the prior 12-week average, the down move is not confirmed and the short should be cut. If volume expands while price holds below Thursday's 170.99 low, the position can be raised to full signal size.
What sets this case apart
The decision turns on volume and the one-hour retracement after the low, not on the size of the weekly loss or on the asset's distance from its 52-week high.