Week of 26 November 2018: Bitcoin rises 1.77% while Ether falls 1.75% for the week
After four straight weeks of falling prices, what does a week in which Bitcoin rises and Ether falls say about how the two assets move together, and what can price data alone not settle?
BTC rose 1.77% to 4,161.01 and ETH fell 1.75% to 116.57, opposite weekly directions even though their hourly correlation was 0.9. Both lows came at 10:00 UTC on Tuesday 27 November. BTC volume was 1.57 times its prior twelve-week average, while ETH's was 0.81 times.
What the data shows. The four weeks before this one all closed lower for BTC (-0.06%, -0.56%, -12.23%, -27.84%). This week BTC rose 1.77%, from 4,088.69 to 4,161.01, while ETH fell 1.75%, from 118.65 to 116.57. Both set their weekly low in the same hour, 10:00 UTC on Tuesday 27 November: BTC at 3,689.12, ETH at 102.36. BTC then reached 4,450.38 at 11:00 UTC on Thursday 29 November, a range of 20.64%. BTC's best day was Wednesday 28 November (+10.04%) and its worst Friday 30 November (-5.92%). BTC dollar volume of 1.96 billion was 1.57 times its prior twelve-week average; ETH's 0.38 billion was 0.81 times. Both closed in the middle third of their weekly range, at 62.0% for BTC and 58.1% for ETH.
What it does not show. Nothing in these candles explains why the two assets ended the week in opposite directions. The data does not identify who was trading, or whether the moves came from new buying and selling or from positions being closed.
What a careful desk would check. Realised volatility, the swings that actually happened scaled to a yearly figure, was 105.6% for BTC and 105.0% for ETH. The largest single hourly moves were +4.49% for BTC in the hour starting 04:00 UTC on Wednesday 28 November and -3.1% for ETH in the hour starting 12:00 UTC on Thursday 29 November. At the week's close BTC stood 64.51% below its 52-week high and ETH 89.94% below its own, so this rebound week sits inside a longer decline. BTC's return ranked at the 54th percentile of the 41 weeks in the record.
Ether against Bitcoin. The hourly correlation was 0.9, described as very close, yet the ETH/BTC ratio, the price of Ether measured in Bitcoin, fell 3.46%, and ETH finished 3.52 percentage points behind BTC. The gap came from the daily returns: ETH's worst day was Monday 26 November (-6.72%), while its best, Wednesday 28 November (+10.34%), tracked BTC's +10.04% closely. ETH volume ran below its prior twelve-week average while BTC's ran above.
What would change this reading
- If BTC closes a later week below this week's open of 4,088.69, the four weeks of decline before this one become the main reading again.
- If ETH holds above its weekly low of 102.36 while the ETH/BTC ratio keeps falling, the gap between the two assets deepens into a trend.
- If BTC volume returns below its prior twelve-week average while price stalls below 4,450.38, the 1.57 times reading looks like a one-week surge rather than sustained interest.
Terms
- realised volatility
- how much the price actually swung over the week, expressed as a yearly percentage
- ETH/BTC ratio
- the price of Ether measured in Bitcoin, so its change shows which asset gained against the other
- percentile
- the share of past weeks with a lower value; the 54th percentile sits near the middle of the record