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Bitcoin ($BTC) surged above $76,000 despite ongoing tensions in the Middle East. However, after this recovery, the $BTC price fell back to around $73,000, prompting a bull trap warning from an analyst.
On-chain analyst Willy Woo has once again warned of a bull trap for Bitcoin.
Woo stated that the recent rallies have come from futures and leveraged trading, arguing that the bottom has not yet been reached.
Veteran analyst Willy Woo stated that the recent Bitcoin recovery was driven by short-term buyers in the futures market.
Woo stated that for these reasons, the market bottom has not yet been formed, and warned investors to be wary of a bull trap.
He noted that liquidity from such short-term buyers is often followed by sharp price fluctuations or sudden price changes.
Woo said that on-chain data showed potential for a rise to around $80,000, the average cost floor for short-term investors. However, he added that the data still indicated that only a third of the bear market was over.
“Buying pressure is coming from short-term buyers. This kind of liquidity can also trigger sudden price drops.”
Be careful, this could be a bull trap; the bottom hasn’t formed yet.
We’ve only passed about a third of the bear market so far.”
*This is not investment advice.