Week of 29 October 2018: Bitcoin ends flat while Ether gains 3.47% on light volume
In a week when Bitcoin barely moved but Ether rose 3.47%, what does the gap between them reveal about a market still deep below its highs on very thin volume?
BTC went from 6,489.93 to 6,485.85 (-0.06%) while ETH went from 204.99 to 212.11 (+3.47%). Both fell to their lows on Wednesday 31 October, then reached their highs on Sunday 4 November. Dollar volume was 0.29 times the prior 12-week average for BTC and 0.27 times for ETH.
What the data shows. Both assets bottomed mid-week and finished near their tops. BTC's low of 6,245.02 came at 15:00 UTC on Wednesday 31 October, in the same hour as its largest hourly move (+2.07%, a bounce off the low). ETH's low of 193.01 followed one hour earlier at 14:00 UTC. Both highs arrived at 18:00 UTC on Sunday 4 November, where ETH also posted its largest hourly move (+4.2%). Sunday was the best day for both (BTC +1.53%, ETH +5.91%); Monday 29 October was the worst (BTC -2.24%, ETH -3.92%). Both closes sat in the upper third of their weekly ranges (BTC 86.0%, ETH 74.2%). Realised volatility, the size of the swings that actually happened scaled to a yearly figure, was 26.0% for BTC and 50.2% for ETH.
What it does not show. The two assets moved in different directions over the week, and hourly correlation of 0.79 only measures how closely they tracked each other hour by hour, not why they diverged. Dollar volume of 0.46bn for BTC and 0.15bn for ETH was 0.29 and 0.27 times their prior 12-week averages, so this week's prices were reached with far less trading than usual. Light volume makes a move easier to reverse. Nothing here identifies who was trading or what followed.
What a careful desk would check. The prior four weeks were down for three of them (BTC -0.17%, -4.17%, 3.96%, -1.52%), and BTC still sat 44.68% below its 52-week high, ETH 81.7%. BTC's -0.06% return ranked at the 49th percentile of the 37 weeks recorded before it, a middle-of-the-pack week.
Ether against Bitcoin. The ETH/BTC ratio rose 3.54%, and ETH's weekly return exceeded BTC's by 3.53 percentage points. Sunday 4 November was the best day for both assets, but ETH gained 5.91% while BTC gained 1.53%, so the two were not flat against each other on the week's strongest day.
What would change this reading
- If a later week trades below BTC's low of 6,245.02, the mid-week dip reads as a level that eventually gave way rather than a floor.
- If volume returns towards its prior 12-week average while price holds above the Sunday open area, this week's quiet rise gains credibility.
- If the ETH/BTC ratio gives back the 3.54% gain, the divergence was a short-lived rotation rather than a change in relative trend.
Terms
- percentile
- the share of past weeks with a lower value; the 49th percentile means roughly half of the 37 prior weeks were lower
- realised volatility
- how much the price actually swung over a period, expressed as a yearly percentage
- ETH/BTC ratio
- the price of one Ether measured in Bitcoin; when it rises, Ether is gaining against Bitcoin