Affairs on the Potomac.
Williamsport, August 10.
--Everything here at this time is rather in an state.
The towards full of refugees from Virginia, and, as a consequence, the hotels are doing an extra good business.
In the distance, towards Martinsburg, we hear the booming of cannon, and judge that a heavy battle is being fought this side of Winchester.
Yesterday afternoon the rebels withdrew their pickets from Falling Waters, and last night retired out of Martinsburg to a point two miles distant, towards Winchester, where they bivouacked during the night.
Among the refugees from Virginia here is the proprietor of the United States Hotel at Martinsburg.
The canal at this point has been much destroyed, the locks broken and the bank cut. As a consequence; the canal bed is now quite dry, and canal-boats lie on the bare ground loaded in the middle of the bed. 