Markets move in emotional cycles from capitulation and despondence to thrill and euphoria:
Today we are probably somewhere between fear and desperation in the commodity arena while the cryptocurrency arena is closer to the opposite end of the emotional spectrum; probably somewhere between the excitement and thrill phases.
Bitcoin and its little brother Ethereum have turned completely parabolic in the last couple of weeks:
Bitcoin/USD (Weekly)
Ethereum/USD (Daily)
If these were stock charts I would selling any long positions I had (but I would not be shorting, yet). The interesting aspect of cryptocurrencies is that they are alternative currencies which in theory cannot be devalued by a central bank or confiscated at gunpoint by an oppressive government.
There is definitely a big pie in the sky to the cryptocurrency story and the reason why I don't think we're at the euphoria stage is that only a couple of people that I personally know (aside from myself) own any.
I know a lot of people who own gold and silver, I don't know many people who own bitcoin or ethereum. While there are a lot of people who DO own cryptocurrencies, the scale is still fairly small relative to what's possible; even after the recent surge the total cryptocurrency market cap is still only about $40 billion, smaller than the market cap of General Motors.
The fact that I'm writing this means that cryptos are certainly in the excitement stage, and that excitement is building. I'm not jumping in to buy Bitcoin here, but I do own some Ethereum (bought just below $50 a month ago) and I don't have plans to sell it, yet.
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