Eric Jackson Says Tom Lee Is Right About Bitcoin Leading Stocks – But The Signal Is Too Noisy To Bet On

EMJ Capital founder Eric Jackson put FundStrat’s Tom Lee to the test over his assertion that crypto has historically led the stock market by about a month. Jackson confirmed Lee's basic observation was statistically sound but deemed the resulting trading signal too noisy to trade.Analyzing 143 months of Bitcoin (BTC) and S&P 500 data going back to September 2014, Jackson wrote on his Substack on Tuesday that the pattern was statistically correct.He explained that the S&P 500 gained an average of 1.46% following a positive month for Bitcoin. After a negative month for Bitcoin, the S&P averaged +0.23%.The Signal Fades FastJackson found the effect moved faster than commonly assumed. Rather than unfolding over a full month, 78% of the total three-month response happened within the first 15 days after a Bitcoin move, and the signal had essentially disappeared by the fourth week.He concluded that even though the pattern was statistically real, it wasn't strong enough to actually beat the market. He measured this using the Sharpe ratio, a common measure of how much return a strategy delivered relative to the risk it takes on.He found that trading on the signal scored about the same as simply buying and holding stocks the whole time, meaning everyday market swings drowned out whatever edge the signal offered.Previously, Eric Jackson predicted in an interview that Bitcoin would reach $50 million per coin by 2041, was down by 0.3% during the past 24 hours. On Stocktwits, the retail sentiment around BTC remained in the ‘neutral’ zone, while chatter around it stayed at ‘normal’ levels over the past day.Tom Lee’s TakeJackson's analysis was a response to comments by  who had argued for a contrarian bullish case in September even as markets pulled back, oil rose, and yields climbed.Lee pointed to inflation fears easing over the coming weeks, citing Friday's jobs report, next week's August Consumer Price Index (CPI) print, and the September Fed rate decision as a sequence he expected that will push the odds of a rate hike toward zero.Lee also said that a chunk of this year's inflation may be coming from a narrow slice of the economy, computer chips and software, rather than the everyday costs like gas that most people actually feel.Beyond his role at Fundstrat, Lee chairs BitMine Immersion Technologies (BMNR), the largest corporate holder of Ethereum (ETH).  was down over 1% during midday trading. On Stocktwits, the retail sentiment around BMNR remained in the ‘bullish’ zone, while chatter around it shifted to ‘normal’ from ‘high’ over the past day.