How To Play Bitcoin And Bitcoin Stocks Right Now

And that brings us to Coinbase – a stock we don't need a chart for… because it's only been trading for five sessions at this point. From a technical perspective, the data's not there, and so there's nothing to say.

The way I see it, the highly anticipated direct listing offers a quandary for all investors: On one hand, this is probably the future of cryptocurrency. On the other, COIN shares are expensive by anyone's standards. How expensive is "expensive"? Well, it boasts a P/E ratio of 700 (no, that's not a typo: seven hundred), and the stock trades for more than 50 times last year's earnings.

Like so many other IPOs over the past few years, the valuations at opening bell on listing day are way higher than the market appreciates – or is willing to pay.

That said, I think the market is chopping it down to size right now. The market itself could be ready to post a healthy correction (that's a story for a different day), which makes COIN an "alpha stock" to watch from a distance right now.

Long term, it's a totally different story. So, I do want to buy Coinbase – just not here. My fondness for round numbers would kick in at $300, but there again, I'd wet my beak. Like any other new stock, I'm waiting for the real read on the data. When I get it, you'll be the first to know.

The market hasn't discovered Coinbase's real valuation yet. That won't last forever. There will be money to be made on Coinbase as crypto gets bigger and bigger in our everyday lives.

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Disclaimer: Any performance results described herein are not based on actual trading of securities but are instead based on a hypothetical trading account which entered and exited the suggested ...

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