Bitcoin may experience a short-term rally that surprises investors before the broader downtrend continues, according to on-chain analyst Willy Woo. According to Cointelegraph, Woo suggested in a recent post that a "bull trap" could be forming, indicating a false breakout that might mislead the market into believing a sustained uptrend is underway. He speculated that this rally could extend until the end of April.
Woo's analysis is based on liquidity conditions rather than price levels. He mentioned that if capital returns with the right type of long-term investors, he would reconsider his outlook. From a long-term liquidity perspective, Woo stated that Bitcoin is "solidly in the middle of its bear market." He explained that after rapid downward movements, Bitcoin often stabilizes and attempts a rally to test resistance levels. Bitcoin has declined approximately 46.82% since its October all-time high of $126,000, currently trading at $67,012, as reported by CoinMarketCap. Over the past 30 days, Bitcoin has seen a 3.74% increase.
Woo believes that the current level is not the bottom for Bitcoin, suggesting the asset may face further declines. Crypto sentiment platform Santiment echoed this sentiment, noting that whales are aggressively selling while retail investors are buying below $70,000. Santiment indicated that when retail investors buy while whales sell, it often signals that the correction is not yet complete. Despite Bitcoin's inability to maintain the "mid-70s" range after reaching $74,000, Woo observed that investor flows have been in "consistent recovery" since mid-February.
Other analysts share Woo's bearish outlook. Crypto analyst Benjamin Cowen recently stated that 2026 is likely to be a "bear market year" for Bitcoin, with little chance of reaching new all-time highs. On-chain analytics firm CryptoQuant also noted that Bitcoin remains in a bear market despite recent rallies. This observation follows the Crypto Fear and Greed Index, a popular measure of crypto investor sentiment, which fell back to "extreme fear" levels after a brief recovery.