Week of 6 September 2021: Bitcoin loses 11.07% and Ether 13.82%, almost all on one Tuesday
When a week's entire loss arrives in a single day, what does the shape of that day reveal about volatility, crowding, and the levels a desk should test in later weeks?
BTC fell from 51,756.88 to 46,025.24 (-11.07%) and ETH from 3,950.28 to 3,404.21 (-13.82%). Tuesday 7 September alone took 11.02% off BTC and 12.53% off ETH. Funding stayed positive all week, so long positions were paying short ones while price fell.
What the data shows. Nearly the whole week came down to Tuesday 7 September. BTC set its high of 52,920.00 at 03:00 UTC and its low of 42,843.05 twelve hours later at 15:00 UTC, a 23.52% high-to-low range. The largest hourly move, -6.36%, began at 14:00 UTC, the hour before the low. ETH ran the same clock: high 3,970.00 on Monday, low 3,005.00 at 15:00 UTC Tuesday, and its own largest hourly move, -8.87%, in that same 14:00 hour. Volume finished above the prior twelve-week average for both assets (1.09x for BTC at 18.97 billion dollars, 1.23x for ETH at 15.56 billion). Both then stabilised, with the week's best days on Sunday 12 September (+1.89% BTC, +4.20% ETH). BTC closed at 31.6% of its weekly range, in the lower third; ETH closed at 41.4%, in the middle third. The weekly return ranked at the 11th percentile of the 186 weeks recorded before it, so only about one week in nine had fallen further.
What it does not show. The candles record the shape of the fall, not its cause, and not who was selling. Positive funding tells us long holders were paying short holders; it does not tell us how large those long positions were. The Sunday recovery does not establish that the Tuesday low was final.
What a careful desk would check. Realised volatility, the size of the swings that actually happened scaled to a yearly figure, reached 74.8% for BTC and 116.7% for ETH. A stop calibrated on the prior four weeks (BTC returns of 7.26%, 4.82%, -0.96% and 6.13%) would not have been sized for a -6.36% or -8.87% hour. A desk would also ask whether its exits could have been filled inside that hour at all, and whether funding is counted as a running cost.
Ether against Bitcoin. Hourly correlation was 0.91, very close, so this was a broad move rather than one asset leaving the other behind. ETH still fell harder: 2.75 percentage points worse, taking the ETH/BTC ratio down 3.09%. BTC sat 28.73% below its 52-week high, ETH 21.43% below its own.
What would change this reading
- If a later week trades below 42,843.05 for BTC or 3,005.00 for ETH, the Tuesday low reads as a pause rather than a floor.
- If funding turns negative while price holds above those Tuesday lows, the crowded-long reading behind the fall weakens.
- If ETH again falls faster than BTC, with the ratio already down 3.09% this week, the broad move is becoming a relative one.
- If BTC closes a later week back above its weekly open of 51,756.88, the week reads as a shock that was absorbed.
Terms
- realised volatility
- how much the price actually swung over a period, expressed as a yearly percentage
- funding rate
- the periodic payment between long and short holders of a perpetual futures contract; positive means longs pay shorts
- percentile
- the share of past weeks with a lower value; the 11th percentile means 11% of past weeks were lower