Week of 23 December 2019: Bitcoin slips 1.5% while Ether gains 1.7% in the same week
When Bitcoin and Ether move in opposite directions over one week, what does the price and funding data say about the split, and what can it not say about its cause?
BTC fell from 7,500.71 to 7,388.24 (-1.5%) while ETH rose from 132.12 to 134.36 (+1.7%). Both assets set their weekly low at 11:00 UTC on Friday 27 December, but only ETH went on to a new weekly high, on Sunday. Dollar volume sat below the prior twelve-week average for both.
What the data shows. The two assets shared a floor and then separated. Both hit their weekly low at 11:00 UTC on Friday 27 December (BTC 7,076.42, ETH 121.91). BTC had already printed its high of 7,695.38 on Monday 23 December at 16:00 UTC, so its low came after its high and the week drifted down from there. ETH instead pushed to a new weekly high of 138.07 on Sunday 29 December at 20:00 UTC, closing in the upper third of its range (77.0%) while BTC closed mid-range (50.4%). The ETH/BTC ratio, the price of Ether measured in Bitcoin, rose 3.24%. Hourly correlation was 0.77, close but not tight, and ETH's 13.26% range was wider than BTC's 8.75%. Volume was light across the week: 0.73 times the prior twelve-week average for BTC and 0.56 for ETH. BTC's weekly return ranked at the 38th percentile of the 97 weeks recorded before it, ETH's at the 57th. BTC sat 47.08% below its 52-week high, ETH 62.45% below.
What it does not show. The candles record the split, not its reason. Nothing here identifies who bought Ether or sold Bitcoin, or whether the divergence was one flow unwinding or two separate ones. Weekly dollar volume says the week as a whole was thin, but it cannot show how activity was distributed across the hours, so the Sunday high cannot be judged by turnover. The data also says nothing about what followed.
What a careful desk would check. A 0.77 hourly correlation is close but well short of a perfect one-to-one link, so any analysis that assumes the two assets move together hour for hour would have been wide of the mark this week. A desk would also note that BTC's largest hourly move (-1.77%) and ETH's (-1.79%) landed in the same hour, 17:00 UTC on Monday, so the shared risk did not disappear when the weekly directions split. The 3.2% gap between the two weekly returns is close to the 3.24% change in the ETH/BTC ratio, as it should be, and any larger claim about a durable split needs more than one week.
What would change this reading
- If ETH holds above its weekly low of 121.91 while BTC trades below its own low of 7,076.42, the split becomes a trend rather than one week's divergence.
- If the ETH/BTC ratio gives back the week's 3.24% gain, the outperformance reads as noise in a thin week.
- If volume returns above the prior twelve-week averages of 0.73 for BTC and 0.56 for ETH, the next move carries more information than this week's.
Terms
- ETH/BTC ratio
- the price of Ether measured in Bitcoin; it rises when Ether outperforms Bitcoin
- correlation
- how closely two prices moved together hour by hour, from -1 to 1
- percentile
- the share of past weeks with a lower value; the 38th percentile means 38% of past weeks were lower