Bitcoin (BTC) hit a 48-hour high on the night of May 20, as the weakness in the US dollar gave the bulls some much-needed rest.
Dollar strength weakens after 20-year record
Data from Cointelegraph Markets Pro and TradingView recorded a high of $30,725 for BTC/USD on Bitstamp.
The pair still struggled to turn $30,000 into a reliable support, but nevertheless avoided a deeper retracement, easing fears that last week’s $23,800 capitation would not mark the bottom.
The US dollar index (DXY) provided the background for Bitcoin’s relatively solid performance, coming out of two decades and falling 2% in a week.
This seemed to ease some pressure on the stock markets, with the S&P 500 closing May 19 at a more modest 0.58% compared to the Nasdaq 100 less earlier in the week.
While the water remained more than 50% below its all-time high, the largest cryptocurrency had penalized latecomers to the market, an analyst noted.
“Today, new entrants who joined last year have a loss of -34%,” said Ki Young Ju, CEO of analytics platform CryptoQuant, wrote in a series of tweets on the day.
Ki highlighted a chart of bands of unspent transaction outputs (UTXOs) indicating the age of investments. Those that had previously experienced just one “bear cycle” were now down 39%, he concluded, while older coins were still making gains.
“So here’s hopium for bears. If $BTC crashes that hard due to the macro crisis and all Bitcoiner institutions go under water, it could hit $14k based on historic MDD,” he added.
As Cointelegraph reported, multiple predictions of a major BTC price adjustment, some below $14,000, continue to circulate.
Altcoins roll over
Meanwhile, attention was focused on Bitcoin’s increasing presence in the market relative to altcoins.
Related: Bitcoin Must Defend These Price Levels To Avoid A ‘Much Deeper’ Drop: Analysis
After the Terra LUNA debacle, the mood outside BTC had turned cold, and now there were signs that alts could soon relinquish dominance.
At 44.8%, Bitcoin’s share of the total cryptocurrency market cap was at its highest point since October 2021 at the time of writing.
“We could see the dominance rise to 60%”, popular Twitter account IncomeSharks prediction†
“This is why you have to be careful with alts and trade them with tight stops. There is a good chance we will see money leaving and going back to BTC.”
60% BTC market dominance would represent a level not seen since March last year.
“Most of the alts I’ve seen haven’t been able to break their H4 trends despite yesterday’s move on BTC,” co-pop analyst Pierre warned†
“I would still expect most of them to die twice as much if btc stayed in the same range, or went down.”
The views and opinions expressed herein are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risks, you should do your own research when making a decision.
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