Week of 25 July 2022: BTC and ETH both rise, ETH ahead by 1.86 percentage points
After a run of alternating weekly gains and losses, what does a week with a 19.13% BTC range that still closed 3.17% higher say about the path, not just the result?
BTC rose from 22,577.13 to 23,293.32 (+3.17%), ETH from 1,597.70 to 1,678.12 (+5.03%). Both fell to their lows on Tuesday 26 July before recovering, so the week's path was far wider than its close. Hourly correlation was 0.91, and the ETH/BTC ratio gained 1.8%.
What the data shows. BTC opened at 22,577.13, fell to its low of 20,706.50 on Tuesday 26 July at 15:00 UTC, then rose to 24,668.00 on Saturday 30 July at 13:00 UTC, closing at 23,293.32 (+3.17%). ETH followed the same order — low before high — from 1,356.17 on Tuesday to 1,784.79 on Thursday 28 July, closing at 1,678.12 (+5.03%). The two assets moved closely hour by hour (correlation 0.91), and ETH's larger gain lifted the ETH/BTC ratio 1.8%. Both fell hardest on Monday 25 July (BTC -5.61%, ETH -9.82%) and rose most on Wednesday 27 July (BTC +7.99%, ETH +12.88%), the day of each asset's largest hourly move (+4.32% for BTC, +5.43% for ETH). BTC dollar volume was 1.60 times its prior twelve-week average; ETH's was 1.11 times.
What it does not show. The weekly returns conceal a 19.13% BTC range and a 31.61% ETH range, so a position held from open to close absorbed far less than the path between them. Nothing here says who bought after Tuesday's low, or whether the recovery reflects new demand rather than positions being closed. The weekly returns ranked at the 63rd percentile for BTC and the 64th for ETH across 232 weeks: above average, not extreme. The percentile gives no information about what follows.
What a careful desk would check. Realised volatility (the size of the swings that actually happened, scaled to a yearly figure) reached 65.7% for BTC and 98.6% for ETH, so a range this wide is compatible with an unremarkable week. Close location (where the close sits inside the week's range) was 65.3% for BTC, placing it in the middle third of the range, and 75.1% for ETH, placing it in the upper third. Both remain 66.06% and 65.38% below their 52-week highs, so a 3.17% gain is small against that backdrop. A desk would confirm that its sizing allowed for ETH's 31.61% range against BTC's 19.13%, and that its hedges assumed the 0.91 correlation would hold.
Funding. BTC perpetual funding (a regular payment between long and short holders of perpetual futures) averaged 0.0078% per eight hours, between 0.0012% and 0.01%. ETH averaged 0.0075%, with an 8-hour low of -0.0011%, when shorts paid longs. On average, longs paid a small amount during a rising week.
What would change this reading
- If a later week trades below BTC's Tuesday low of 20,706.50, the recovery reads as a bounce inside a market still falling.
- If ETH's weekly return again exceeds BTC's and the ratio rises further, ETH is doing the leading, which changes which hedge matters.
- If funding stays near 0.0078% while BTC stalls below 24,668.00, longs keep paying for a position that has stopped rising.
- If volume falls back towards its prior twelve-week average, the week's move may reflect fewer participants rather than a shift in trend.
Terms
- realised volatility
- how much the price actually swung over a period, expressed as a yearly percentage
- close location
- where the week's closing price sits between its low and its high, as a percentage
- perpetual funding
- a regular payment between long and short holders of a perpetual futures contract that keeps its price close to the spot price