Week of 21 June 2021: Bitcoin rebounds from a 24% range as Ether loses 11.64%
When a market falls hard early in the week and recovers most of it by Sunday, what does the weekly return hide, and what does the relative weakness of Ether add?
BTC went from 35,600.17 to 34,700.34 (-2.53%) after touching 28,805.00 on Tuesday, a 24.11% range, and closed in the upper third of that range. ETH fell from 2,243.49 to 1,982.28 (-11.64%) on a 32.91% range. The two moved closely (hourly correlation 0.93) but the ETH/BTC ratio dropped 9.35%.
What the data shows. BTC printed its weekly high of 35,750.00 in the first hour on Monday 21 June, then fell to 28,805.00 by 13:00 UTC on Tuesday 22 June. Its largest hourly move was -4.85% in the hour starting 06:00 UTC on Monday, which was also the worst day (-11.21%). The week then reversed: Sunday 27 June was the best day (+7.49%), and the close of 34,700.34 sat at 84.9% of the weekly range, in the upper third. ETH followed the same shape and fell harder: high 2,260.16 on Monday 00:00, low 1,700.48 on Tuesday 13:00, close 1,982.28, with the largest hourly move a gain of 6.51% in the hour starting 22:00 UTC on Sunday. Realised volatility, the size of the swings that happened, annualised, reached 125.3% for BTC and 142.8% for ETH. Both weekly returns were low in their own history: the 27th percentile for BTC and the 13th for ETH across 175 weeks.
What it does not show. The candles do not identify who was selling on Monday and Tuesday or what forced it. The Sunday recovery does not establish that the Tuesday low was a floor. Volume tells against panic at the extremes: BTC dollar volume of 29.61 billion was about equal to its prior twelve-week average (1.04x), and ETH's 14.01 billion was below its own (0.65x).
What a careful desk would check. The weekly return of -2.53% for BTC compresses a 24.11% range into one number, so a desk would look at the path rather than the endpoint: BTC opened 23.59% above its weekly low and closed at 84.9% of the range, so almost all of the week's loss sat in the days between, not in the close. ETH's open sat 31.93% above its low and its close landed at 50.4%, in the middle third, so the same shape produced a very different ending. Realised volatility of 125.3% for BTC suggests that position sizes and limits set on calmer weeks would need rechecking against swings of this size.
Ether against Bitcoin. Hourly correlation was 0.93, very close, so this was one market moving, not two. But the ETH/BTC ratio fell 9.35%, and ETH sat 54.25% below its 52-week high against BTC's 46.27%: Ether carried the larger weekly loss and the deeper drawdown.
What would change this reading
- If BTC trades below the Tuesday low of 28,805.00 in a later week, the recovery reads as a pause rather than a floor.
- If the ETH/BTC ratio keeps falling while both assets rise, Ether's weakness is relative and hedges between the two behave differently.
- If funding turns positive after a week of negative averages, long positions would start paying short ones, adding a small cost to the recovery.
Terms
- realised volatility
- how much prices actually swung over the period, scaled to a yearly percentage
- close location
- where the weekly close fell within the week's high-to-low range, as a percentage
- funding rate
- the periodic payment between long and short holders of a perpetual futures contract; negative means shorts pay longs