Weaker Dollar Pushes Bitcoin to $307,000, Analysts See 60% Dominance

A weaker U.S. dollar gave bulls some much-needed respite, with Bitcoin ( BTC ) hitting a 48-hour high overnight on May 20.

BTC/USD 1-hour candlestick chart (Bitstamp). Source: TradingView

Dollar strength slips after 20-year record

Data from Cointelegraph Markets Pro and TradingView recorded a high of $30,725 for BTC/USD on Bitstamp.

The BTC/USD pair is still struggling to turn $30,000 into solid support, but has still avoided a deeper pullback, helping to quell concerns that last week's $23,800 capitulation sell-off has not bottomed out.

Supporting bitcoin's relatively steady performance was the U.S. dollar index (DXY), which retreated from 20-year highs and lost 2% in a week.

That appeared to ease some of the pressure on stocks, with the S&P 500 closing down 0.58% from the previous week on May 19 and the Nasdaq 100 down less.

US dollar index (DXY) 1-hour candlestick chart. Source: TradingView

While Bitcoin is more than 50% below its all-time high, the largest cryptocurrency is punishing latecomers to the market, one analyst noted.

“Today, 34% of new coins added last year are lost,” Ju Ki Young, CEO of analytics platform CryptoQuant, wrote in a series of tweets that day.

Ki highlighted a chart showing unspent transaction output (UTXO) bands for years of investment. He concluded that those coins that had previously experienced only one “bear cycle” are now down 39%, while older coins are still profitable.

“There is narcotic hope for the bears. If Bitcoin crashes due to a macro crisis and all Bitcoin institutions go bust, it could drop to $14k based on historical MDD,” he added.

According to Cointelegraph, the prediction of a sharp correction in the price of Bitcoin below $14,000 continues.

Altcoins are overturned

At the same time, interest in bitcoin continues to outpace altcoins.

After Terra LUNA collapsed, currencies other than Bitcoin took a hit. Now, there are signs that altcoin trading may be ceding its dominance quickly.

As of this writing, Bitcoin’s share of the total cryptocurrency market capitalization stands at 44.8%, the highest since October 2021.

Popular Twitter account IncomeSharks predicts: “We may see Bitcoin’s market dominance all the way back up to 60%.”

“That’s why you need to be cautious with altcoins and trade with tight stops. There’s a good chance we’ll see money leave altcoins and flow back into bitcoin.”

Bitcoin's 60% market dominance would be a level not seen since last March.

“Despite Bitcoin’s volatility yesterday, most of the altcoins I observed failed to break the H4 trend,” warns another popular analyst, Pierre.

"If Bitcoin continues to be stuck in this range, or is determined to go down, most altcoins will die worse."

Bitcoin dominance 1-week candlestick chart. Source: TradingView

Cointelegraph Chinese is a blockchain news information platform, and the information provided only represents the author's personal opinion, has nothing to do with the position of the Cointelegraph Chinese platform, and does not constitute any investment and financial advice. Readers are requested to establish correct currency concepts and investment concepts, and earnestly raise risk awareness.