Week of 2 July 2018: BTC and ETH rise together on below-average volume after weeks of decline
When two assets rise together after several falling weeks but on light volume, how should a reader weigh the rebound against the caution signals in the same data?
BTC rose from 6,360.82 to 6,712.10 (+5.52%) and ETH from 452.14 to 486.77 (+7.66%), moving in the same direction with 0.90 hourly correlation. Both weeks ended in the upper third of their ranges, yet dollar volume was 0.79 and 0.78 times the prior 12-week averages. BTC remained 42.75% below its 52-week high.
What the data shows. Both assets bottomed early and rose through the week. BTC's low of 6,271.62 came at 06:00 UTC on Monday 2 July, and its high of 6,818.16 arrived late in the day on Saturday 7 July; ETH followed the same order, low at 06:00 UTC Monday, high at 15:00 UTC on Sunday 8 July. Monday was the best day for both (BTC +4.00%, ETH +5.33%) and also contained the largest hourly move, +3.89% for BTC and +4.70% for ETH in the hour starting 13:00 UTC. Tuesday was the worst day (BTC -1.53%, ETH -3.04%). The two assets moved very closely hour by hour (correlation 0.90), and ETH gained a further 2.02% against BTC on the ratio. Both closed in the upper third of their weekly ranges.
What it does not show. The rebound followed three down weeks for BTC and four for ETH, but 20 weeks of history is not enough to place this week's return in a percentile, so its rarity cannot be judged here. Dollar volume came in below the prior 12-week average for both (0.79 and 0.78 times), which describes participation, not its cause or composition. No funding data is available for this week, so the cost of leveraged positions cannot be read. Nothing here says whether the low was final.
What a careful desk would check. BTC was still 42.75% below its 52-week high and ETH 58.01% below, so a 5.52% and 7.66% weekly gain remains small against the prior decline. Realised volatility stood at 52.3% annualised for BTC and 67.5% for ETH. A desk would compare the light volume with the size of the move and ask whether a rise on fewer dollars can be repeated.
What would change this reading
- If a later week closes above BTC's weekly high of 6,818.16 on stronger volume, the rebound reads as a change in trend rather than a pause.
- If volume stays below its prior 12-week average while price stalls, the light participation becomes the more telling signal.
- If ETH's outperformance on the ratio continues beyond the 2.02% of this week, the move is becoming a relative one and not simply a shared recovery.
- If a later week trades below this week's low of 6,271.62, Monday's floor was temporary.
Terms
- realised volatility
- how much the price actually swung over a period, expressed as a yearly percentage
- hourly correlation
- how closely two prices moved together hour by hour, from -1 to 1
- close location
- where the week's closing price sat within the week's high-to-low range