Bitcoin could not break the resistance level, expert calls for new capital inflow

Bitcoin (BTC) price failed to break above a crucial hurdle on July 12, pulling back right when it was about to. The rejection has sent BTC back to its range-bound movement, signaling a common resolve among short-term holders to hodl instead of booking profits. Meanwhile, experts continue to investigate what it would take to get the king of crypto to finally make a bold move.

Also Read: Top 3 Price Prediction Bitcoin, Ethereum, Ripple: Altcoins could suffer if BTC holds its ground

Bitcoin fails to breach $31,000, expert weighs in

Bitcoin (BTC) price edged north following Wednesday's Consumer Price Index (CPI) reading, approaching the crucial resistance at $31,000 before pulling back. According to Yann Allemann, co-founder at Glassnode and CEO of Swissblock Technologies, the "immediate volatility to the CPI data release" came as traders (likely whales) put buy and sell walls to prevent volatility.

Further, Allemann observes that there may not be any organic price increase for Bitcoin given that all macro updates had been factored yet Bitcoin price remains unfazed. Accordingly, he concludes that the industry needs a shake-up to inspire a new wave of capital inflow. Despite the Spot BTC Exchange Traded Fund (ETF) mania phasing out, a positive development in this line could likely provide the alluded rouse.

Bitcoin price action has also inspired speculation of an incoming rotation, where capital overflows from one asset class go into another. Citing the expert, "Bitcoin has held its ground while altcoins have suffered." Now that macros have been priced in, and market-moving euphoria such as the metaverse season, speculative trading, and the NFT Ordinals frenzy that drove the meme coin mania for Pepe, and the latest ETF hype, Bitcoin price may have run out of tailwinds to sustain a rally.

Bitcoin capital rotation approaching, altcoins to rally

If there is any truth to this assumption, then the altcoin season may be closing in. For the layperson, the altcoin season, otherwise termed alt season, defines a time when the profits from BTC, Ether (ETH), and/or new capital (ETF, for this case) flow into altcoins. The ensuing capital diversion causes a decline in Bitcoin market share and, therefore, dominance in terms of market capitalization. In tandem, the altcoin market share increases, thus the altcoin season. 

Nevertheless, Allemann holds that the crypto market still needs an impulse for the transition that facilitates the capital rotation to play out. With there being no signs of any impulse on the horizon at the moment, the alt season may not be here just yet. To support this argument, the Glassnode executive observes the price action of altcoins, starting with Ether, which "is trembling because of the lack of demand," while the rest of the altcoins do not show any momentum.

Bitcoin ETFs approval, likely impulse?

Allemann's assertions beg the question of what the possible impulse would be. The candidature of spot BTC ETFs is compelling, despite the recent rejections and re-filings. As reported, former chair of the US SEC, Jay Clayton, detailed what it would take for the financial regulator to approve the filings.

Critical considerations, according to Clayton, include surveillance and market protections for investors. Simply put, the applicants must assure the commission that approving the spot BTC ETFs would not ultimately harm investors. Notably, the only way to do this is to demonstrate efficacy.

Here is what the efficacy entails: Former SEC Chair says it would be difficult to deny approval of spot Bitcoin ETF if efficacy is demonstrated

 At the time of writing, Bitcoin price is $30,331, a daily drop of almost 1%. With a 10% increase in 24-hour trading volume, BTC remains range-bound between the $31,408 and $29,985. 

BTC/USDT 1-Day Chart

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