I only make estimations of expected exchange rates to even powers of 10 because I don't actively trade.
Based on the estimations of the amount of bitcoin-denomimated trade and the assumption that the velocity of bitcoin used for commerce is similar to the velocity in the larger economy I expect the exchange rate to be between $1 and $10 while the amount of annual bitcoin commerce is between $10 million and $100 million.
Likewise if the exchange rate ever reached the $100 and $1000 values that some people are hoping for I would consider it to be a bubble unless the bitcoin economy was supported by $1 billion and $10 billion respectively in annual commerce.
+ 1 for this
If I think about this a bit and unfortunately that is all there is regarding the Bitcoin economy, I think it is overpriced, I would expect to see an economy develop around 1:1 with the USD and when that was stable I would imagine the demand would grow organically.
But even I can't help myself from buying Bitcoin's and pushing up the price.
I see market manipulation all over - I see somewhat well managed buy and a sell wall in the CAD, USD EU and GBP markets.
I expect even Pirate may be manipulating the market and intending paying back Bitcoin after a bubble, but my money is on a big buying frenzy after the first
BTC25 block and a price hike similar to 2011 with somewhat limited demand, and then the dump of the centenary,
BTC300,000-1,000,000 dumped on the market early in the new year or over Christmas 2012.
I have by Bids in at $5, but wouldn't be surprises to see it go below $2. this is pure "Speculation"
