Withdraw is safe on block but if you jump over it it leaves him open for a punish. If you manage to land on him during the move, which is difficult to pull off, he's left in an even more vulnerable state where its easy to punish with a smash attack. Hitting him with the right projectile can also halt Withdraw's momentum, so throw your boomerang close to the ground to block him so he's open for a punish afterwards. I actually have a very hard time exploiting Withdraw against Young Link players because of their good air mobility and rapid fire projectile traps.
Squirtles attacks lack lag but they also lack range. When he starts to get close try to wall him out with your sword. Watch out for his dash attack and fair when he's in their burst range as those are his favorite approach options. When he's in your face stringing together moves don't bother using attacks to shake him off as he outclasses your boxing game big time. Instead use evasive options like jump, air dodge and roll to try and get out and find your spacing.