Week of 23 September 2024: Bitcoin and Ether rise about 3% on below-average volume
When both assets gain roughly 3% for the week on trading volume well below the recent average, what does that combination say about the strength of the move, and what can it not say?
BTC rose from 63,578.76 to 65,602.01 (+3.18%) and ETH from 2,580.99 to 2,657.62 (+2.97%). Both assets set their weekly lows in the first hour on Monday 23 September and their highs on Friday 27 September. BTC dollar volume was 8.57bn and ETH 4.5bn, at 0.69 and 0.71 times their prior twelve-week averages.
What the data shows. Both assets set their weekly low in the first hour on Monday 23 September and their high on Friday 27 September. BTC's low of 62,538.75 came at 00:00 UTC on Monday 23 September, its high of 66,498.00 at 14:00 UTC on Friday 27 September, a range of 6.33%. ETH followed the same low-then-high path, with a 7.45% range between 2,539.49 and 2,728.60. The best day differed: BTC's was Thursday 26 September (+3.2%), ETH's was Monday 23 September (+2.56%). Both assets had their worst day on Wednesday 25 September (BTC -1.73%, ETH -2.76%). Realised volatility, the size of the actual swings scaled to a yearly figure, was 30.3% for BTC and 39.3% for ETH, and the largest single hourly moves were modest (+1.25% for BTC, +1.54% for ETH). BTC closed at 77.4% of the way between its weekly low and high, in the upper third.
What it does not show. Volume was 0.69 times the prior twelve-week average for BTC and 0.71 for ETH, so the gain came on lighter participation than the recent norm. That alone does not tell us whether the move was driven by buying pressure or by an absence of sellers, and the data cannot identify who was trading. The four prior weeks were mixed for both assets (two up, two down), so this week does not confirm a trend on its own. At -10.84% and -34.67% below their 52-week highs, both assets remain well off their peaks, and the data says nothing about what came after Sunday's close.
What a careful desk would check. Funding, the periodic payment between long and short holders of perpetual futures contracts, averaged 0.0041% per eight hours for BTC and 0.0063% for ETH, both slightly positive, meaning longs paid shorts a small amount. The data has no open-interest or positioning figures, so it cannot show whether positions were crowded; the funding cost of holding a long was small. A desk would compare the 3.18% weekly gain against the realised volatility of 30.3% to size positions, and would test whether the light volume undermines the week's close near its high.
What would change this reading
- If volume returns towards its prior twelve-week average in later weeks while price holds above this week's close, the move gains participation and reads more firmly.
- If either asset trades below its weekly low (62,538.75 for BTC, 2,539.49 for ETH), this week's rise reads as a pause within the prior mixed range.
- If funding rises sharply while price stalls, the cost of holding longs increases without a corresponding move higher.
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
- close location
- where the week's close sat between the week's low and high, as a percentage of that range