On-chain analyst Willy Woo warned that Bitcoin ($BTC) could rally toward the mid-$80,000 range but cautioned the move will likely prove to be a bull trap.
The warning comes as exchange data shows buyer activity gradually recovering after weeks of heavy selling in February.
Willy Woo Flags Bitcoin Bull Trap as Buyers Quietly Return to Exchanges
Woo said strengthening short-term fundamentals open the door to a test of the mid-$80,000 level, which aligns with the cost basis of short-term holders. However, he stressed that futures traders are powering the move, not long-term investors.
“Beware this will be a bull trap, the bottom structure has not formed yet. From the liquidity picture Im looking at we are around 1/3 of the way through the bear market,” said Willy Woo.
That type of derivatives-driven liquidity tends to produce sharp whipsaw price action and liquidation cascades, making the rally structurally fragile.
Woo had flagged a similar pattern on March 8, noting that $BTC sold off too fast and was setting up a relief rally toward resistance before the broader downtrend resumes.
Despite a local rejection of mid-70s, investor flows have been in consistent recovery since mid-Feb. Meanwhile expected volatility (VIX) on equities is hinting for a switch to “risk on” in coming weeks.
$BTC sold off WAY TOO FAST in this early bear market and current conditions…
— Willy Woo (@willywoo) March 8, 2026
Buyer Activity Shifts but Remains Early
Meanwhile, CryptoQuant data shows volume delta turning positive on major exchanges. On February 16, Binance‘s 30-day average volume delta sat at -$145 million, and Coinbase’s at -$88 million. Both have since flipped to approximately +$21 million and +$14 million, respectively.
Bitcoin 30-day volume delta chart on Binance and Coinbase. Source: CryptoQuant
“This represents an encouraging shift after a period dominated by selling pressure. That said, this trend still needs confirmation,” wrote CryptoQuant analyst Darkfrost.
$BTC continues to outperform equities and commodities despite rising geopolitical tensions tied to Iran. With the Federal Reserves upcoming FOMC meeting carrying a near-certain probability of no rate change, forward guidance on potential future hikes will be the focal point for risk assets.
Interest Rate Cut Probabilities. Source: CME FedWatch Tool
The recovery in buyer flows is a positive signal, but thin market liquidity and the absence of a confirmed bottom structure suggest traders should approach this rally with caution.
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