Week of 15 April 2019: Bitcoin adds 2.43% and closes in the upper third of its range
When both assets rise on ordinary volume after weeks of much larger moves, what does the shape of the price path say about the strength of the rise?
BTC rose from 5,131.28 to 5,256.14 (+2.43%) and ETH from 167.21 to 168.59 (+0.83%). Both assets set their weekly lows on Monday and their highs in the same hour on Saturday. Dollar volume was near the prior twelve-week average, and no funding data was available.
What the data shows. Both assets fell first and then recovered. BTC set its low of 4,950.00 at 20:00 UTC on Monday 15 April and ETH its low of 155.70 at 17:00 UTC the same day. Both reached their weekly highs in the same hour, Saturday 20 April 08:00 UTC, at 5,333.42 and 176.97. BTC's close sat at 79.8% of the week's range, in the upper third; ETH's at 60.6%, in the middle third. Monday was the worst day for both (BTC -2.07%, ETH -4.34%). BTC's best day was Tuesday 16 April (+2.96%), with its largest hourly move, +2.16%, in the hour starting 17:00 UTC; ETH's best day was Thursday 18 April (+4.57%). Trading activity was unremarkable: 0.88bn dollars for BTC, 0.99 times its prior twelve-week average, and 0.35bn for ETH, 0.94 times. The two assets moved close together hour by hour (hourly correlation 0.78).
What it does not show. The data records the path, not the reason for it. Volume at roughly the prior average means no surge of participation accompanied the rise, so the week cannot be read as either broad conviction or a thin drift. The input contains no perpetual funding figures, so nothing here indicates whether long or short positions were paying to hold.
What a careful desk would check. Realised volatility, the size of the swings that actually happened scaled to a yearly figure, was 32.7% for BTC and 53.3% for ETH, and ETH's weekly range of 13.66% was wider than BTC's 7.75%. The weekly returns ranked at the 59th percentile for BTC and the 57th for ETH against 61 weeks of history, so this was an ordinary week by that measure, set against four prior weeks spanning -0.75% to 26.03% for BTC.
Ether against Bitcoin. The ETH/BTC ratio fell 1.57%, so BTC gained 1.60 percentage points more on the week. ETH remains 79.92% below its 52-week high against 47.26% for BTC, and its volume was further below its own prior average.
What would change this reading
- If BTC trades below 4,950.00 in a later week, Monday's low stops functioning as the week's reference point.
- If the ETH/BTC ratio falls by more than another 1.57% in a week, ETH's lag becomes a trend rather than a single week.
- If dollar volume rises well above 0.88bn for BTC while price holds above the close of 5,256.14, the gain gains participation.
- If ETH's realised volatility stays near 53.3% while BTC's stays near 32.7%, ETH positions need wider buffers for the same move.
Terms
- realised volatility
- how much the price actually swung over a period, expressed as a yearly percentage
- close location
- where the week's closing price fell within the week's high-to-low range, as a percentage
- percentile
- the share of past weeks with a lower value; the 59th percentile means 59% of past weeks were lower