Week of 14 September 2020: Bitcoin gains 5.69% while Ether trails by 4.43 points
When both assets close the week higher but one lags by more than four percentage points, is that gap a shift in relative value, or just a difference in volatility during an ordinary week?
BTC rose from 10,332.84 to 10,920.28 (+5.69%) and ETH from 366.43 to 371.04 (+1.26%). The ETH/BTC ratio fell 4.19%, and both lows came before their highs. BTC dollar volume was 0.97 times its prior 12-week average, so the move came on ordinary activity.
What the data shows. BTC opened the week near its low, touching 10,212.34 at 08:00 UTC on Monday 14 September, and closed at 10,920.28 near its Saturday high of 11,179.79, a weekly range of 9.47%. The largest hourly move was +1.43% in the hour starting 10:00 UTC on Tuesday 15 September. The best day was Monday (+3.28%) and the worst Sunday (-1.45%), so the gain was built gradually rather than from a single surge. ETH followed the same order (low before high) but with larger swings: a 3.71% hourly move in the hour starting 00:00 UTC on Thursday 17 September, a best day of +6.66% and a worst day of -3.69%. Realised volatility, a measure of actual price swings scaled to a yearly figure, was 35.9% for BTC and 69.0% for ETH. Both assets moved closely but not tightly (hourly correlation 0.75).
What it does not show. The data cannot say why BTC held its gain while ETH gave back more of its Thursday high. Neither asset traded above its prior weekly high with conviction: BTC closed 12.09% below its 52-week high and ETH 23.14% below. A 4.43-point return gap in one week is not, by itself, evidence of a lasting change in relative value.
What a careful desk would check. BTC's close sat at 73.2% of the weekly range, in the upper third, while ETH's sat at 41.0%, in the middle third. That difference in where each asset finished is one signal worth tracking into the next week. BTC volume of 4.06 billion dollars was 0.97 times the prior 12-week average and ETH's 2.29 billion was 1.05 times, so neither move came on unusual activity. A desk would also compare this week's +5.69% against the prior four weeks (-2.21%, 0.54%, -12.42%, 0.75%); the return ranked at the 76th percentile of the 135 weeks on record.
Ether against Bitcoin. The ETH/BTC ratio fell 4.19% over the week. ETH carried nearly twice BTC's realised volatility and a wider range (11.03% against 9.47%), so some of the gap is consistent with ETH swinging harder in both directions rather than moving independently.
What would change this reading
- If the ratio keeps falling in later weeks while both assets rise, the lag reads as a durable shift rather than one week's volatility.
- If BTC trades below its weekly low of 10,212.34, this week's upper-third close becomes a failed push rather than a base.
- If ETH repeats hourly moves near 3.71% with funding near zero, position sizing set on BTC's smaller swings will be too large for ETH.
- If funding stays negative for BTC (average -0.0026% per eight hours, low -0.0223%) while price holds its gain, short holders are carrying the cost.
Terms
- ETH/BTC ratio
- the price of one Ether expressed in Bitcoin; when it falls, Ether is losing value relative to Bitcoin
- realised volatility
- how much the price actually swung over a period, expressed as a yearly percentage
- close location
- where the week's closing price finished within the week's full high-to-low range