The Correct command is 

```
tar --exclude='**/.*' -cf - . | pv -s $(du -sb ~/test1 | awk '{print $1}') | (cd ~/test2; tar xf -)
```

1. As @doneals24 posted in a previous comment, the `-f` option is the name of the archive created - therefore you can indicate a dash as the file name

2. The `--exclude` option must follow this format `\*\*/.*` for the pattern to be valid