Week of 8 March 2021: Bitcoin gains 15.7% and closes 4.35% below its 52-week high as Ether lags
When one asset approaches a new high while the other lags and longs pay funding throughout, what can a single week of price data say about leadership and crowding?
BTC rose from 50,959.11 to 58,968.31 (+15.72%) and ETH from 1,726.46 to 1,848.10 (+7.05%). Both set their lows on Monday 8 March and their highs on Saturday 13 March at 20:00 UTC. BTC finished 4.35% below its 52-week high; the ETH/BTC ratio fell 7.49% and funding stayed positive for both.
What the data shows. BTC opened at 50,959.11, traded down to 49,274.67 on Monday 8 March at 08:00 UTC, then rose to 61,844.00 on Saturday 13 March at 20:00 UTC and closed at 58,968.31. The low preceded the high, and the close sat at 77.1% of the week's range, in the upper third, 4.35% below the 52-week high. Saturday was the best day (+6.93%) and carried the largest hourly move (3.19% in the hour starting 10:00 UTC); Sunday 14 March was the worst day (-3.63%). ETH followed the same path with its low and high at the same timestamps, rising 7.05%, but its worst day came earlier, on Wednesday 10 March (-4.03%). BTC dollar volume was 28.88 billion, 1.16 times its prior twelve-week average; ETH volume was 11.37 billion, 0.91 times its average, so the two assets diverged in activity as well as in return.
What it does not show. Hourly correlation of 0.84 means the two moved closely but not identically, and the data cannot say why Ether lagged by 8.67 percentage points or who was buying. Volume below its twelve-week average alongside a 7.05% rise does not distinguish thin demand from an absence of sellers. Nothing recorded here indicates what followed Sunday 23:59 UTC.
What a careful desk would check. Realised volatility, the size of the swings that actually happened scaled to a yearly figure, was 74.1% for BTC and 82.5% for ETH. BTC's prior four weekly returns were 25.21%, 18.17%, -21.38% and 12.93%, and this week's 15.72% ranks at the 90th percentile of the 160 weeks on record. A desk would test whether sizing set during the quieter parts of the week could absorb a 25.51% low-to-high range and the Saturday hourly move.
Funding. BTC perpetual funding averaged 0.0616% per eight hours, ranging from 0.01% to 0.1151%, positive at every reading. ETH funding averaged 0.0724% with a maximum of 0.1552%. Positive funding means holders of long positions paid holders of short ones continuously, so a leveraged long paid to stay in place all week while price rose.
What would change this reading
- If a later week closes below BTC's weekly open of 50,959.11, this week's gain reads as a high that was sold rather than a continuation.
- If funding stays positive while BTC holds below 61,844.00, longs keep paying for a position that is no longer making new highs.
- If the ETH/BTC ratio steadies after its 7.49% decline, Ether's lag reads as a temporary rotation rather than a lasting shift in leadership.
- If ETH volume recovers above its prior twelve-week average while BTC volume cools, the divergence in activity this week was a one-week pattern.
Terms
- funding rate
- the periodic payment between long and short holders of a perpetual futures contract; positive means longs pay shorts
- ETH/BTC ratio
- the price of one Ether expressed in Bitcoin, which shows whether Ether is gaining or losing against Bitcoin
- realised volatility
- how much the price actually swung over a period, expressed as a yearly percentage