Bitcoin (BTC) volatility is approaching cycle highs

The conflicting bullish and bearish signals, which peaked after US President Donald Trump took office in January, have sent crypto prices on a dizzying ride

The recent volatility in Bitcoin's (BTC) price has been attributed to several factors, including the looming trade war and the planned US cryptocurrency stockpile. According to data from TradingView and Glassnode, Bitcoin's volatility is approaching cycle highs.

The conflicting bullish and bearish signals, which peaked after US President Donald Trump took office in January, have sent crypto prices on a dizzying ride, the data shows.

"As demonstrated by the intense whipsaw in price action, this has led to very turbulent conditions over the last two weeks against a backdrop of an uncertain political environment," Glassnode said in a March research note.

Bitcoin's realized volatility — one measure of daily price variations — has "recorded some of the highest volatility values of the cycle so far, exceeding 80% on one- and two-week time-scales and remaining in the mid-70% range on longer time-scales," according to Glassnode.

Meanwhile, the digital currency's average true range (ATR), another volatility measure, has reached cycle highs of more than 4,900, up from around 3,000 in late February, according to data from TradingView.

As of March 5, BTC is down nearly 30% from December highs of around $109,000, the cryptocurrency's highest-ever spot price. Altcoins Ether (ETH) and Solana (SOL) are both down more than 50% off highs, Glassnode said.

President Trump announced on March 4 that he would be imposing 25% tariffs against Canada and Mexico, the United States' largest trading partners.

The bearish news was a bait-and-switch for traders who grew optimistic after Trump tipped plans on March 2 to create a US crypto reserve holding tokens ranging from BTC and ETH to XRP (XRP) and Cardano (ADA).

In response, Bitcoin sunk to around $82,000 after touching highs of around $93,000 on March 3, according to data from Google Finance. Altcoins such as ETH and SOL fell even further, dropping by around 12% and 20%, respectively, the data showed.

The sell-off signaled that macro factors could overpower bullish industry developments, including the US Securities and Exchange Commission's dismissal of several lawsuits against crypto firms in February.

On March 4, cryptocurrency derivatives traders suffered more than $1 billion in liquidations as spot prices whipsawed.