Week of 29 November 2021: Bitcoin falls 13.76% while Ether loses only 2.29%
When two assets fall in the same week but by very different amounts, how much of the move came from a single hour, and what does the divergence tell a careful reader?
BTC fell from 57,274.89 to 49,396.33 (-13.76%) and ETH from 4,294.77 to 4,196.44 (-2.29%). Both assets set their weekly low at 05:00 UTC on Saturday 4 December, the hour of their largest hourly moves (-5.41% and -4.28%). BTC's return ranked at the 8th percentile of 198 prior weeks.
What the data shows. BTC reached its weekly high of 59,176.99 at 15:00 UTC on Tuesday 30 November, in the middle of the UTC day. ETH peaked later, at 4,778.75 at 07:00 UTC on Wednesday 1 December, early in the UTC day. Both then slid to their low at 05:00 UTC on Saturday 4 December — 42,000.30 for BTC and 3,503.68 for ETH — in the same hour as the largest hourly move of the week (-5.41% for BTC, -4.28% for ETH). Saturday was BTC's worst day (-8.3%). Both closed in the middle third of their weekly range (BTC 43.1%, ETH 54.3%). Dollar volume ran above the prior twelve-week average for both (1.13 times for BTC, 1.51 for ETH). BTC's return sat at the 8th percentile of the 198 weeks on record.
What it does not show. The data records prices and volumes, not who traded or why. Nothing here identifies forced selling or the origin of the Saturday drop. The same-hour lows tell us the two assets moved together at that moment (hourly correlation 0.85), but not whether the pattern would repeat.
What a careful desk would check. BTC's range of 40.90% and realised volatility of 81.0% annualised mean a position sized for an ordinary week would be badly exposed during the Saturday hour. The close at 43.1% of the range suggests the market ended mid-way rather than at the extreme, which leaves open whether the low held. A desk would compare stop distances against the -5.41% hourly move.
Ether against Bitcoin. ETH outperformed BTC by 11.47 percentage points, and the ETH/BTC ratio rose 13.29%. Both fell, so this was a broad decline in which BTC gave up more ground. ETH also sat closer to its 52-week high (-13.42% vs BTC's -28.03%).
What would change this reading
- If BTC trades back above its weekly open of 57,274.89 in later weeks, the Saturday low reads as a shock that was absorbed.
- If the ETH/BTC ratio keeps rising after a 13.29% weekly gain, the divergence was a trend rather than a one-week rotation.
- If funding turns negative after averaging positive this week, the pressure on longs would be coming from a different direction.
Terms
- percentile
- the share of past weeks with a lower value; the 8th percentile means most prior weeks were higher
- ETH/BTC ratio
- the price of one Ether expressed in Bitcoin, showing which asset gained relative to the other
- realised volatility
- how much the price actually swung over a period, scaled to a yearly percentage