Tom Lee Says Markets Could 'Rally Very Strongly' in September, Touts Fed Surprise

Fundstrat’s Tom Lee told CNBC on Monday that the four-year crypto cycle ends next month and that Bitcoin could reach six figures if the Fed holds rates at its Sep. 15 meeting.What Lee Said About the Fed and MarketsLee said that September has historically been a weak month, but mounting bearish consensus may actually set the market up to surprise to the upside.His base case is the Fed holds rates steady at the Sep. 15 meeting, and if that happens alongside weaker jobs and CPI data, he argued markets could rally very strongly.Any October weakness from there would likely be shallow, with S&P ) support around 7,300 to 7,400, before the index pushes toward 8,200 or higher by year end.Why Lee Thinks Crypto Has a Big Q4 AheadLee laid out four reasons on CNBC why September and Q4 could be a breakout period for crypto:Crypto is already the best-performing macro asset of Q3The four-year crypto cycle ends next month, bringing sidelined investors backKorean investors who rotated into AI stocks early this year are already showing volume pickups in cryptoA CLARITY Act passage would give Bitcoin and Ethereum (CRYPTO: ETH) a major fourth-quarter tailwind“Very few people own crypto,” Lee said. “That’s why I think Bitcoin could easily be in the six figures.”He added that institutional investors are already buying crypto stocks, with volumes jumping as a sign they are positioning for a big Q4.What Lee and Hayes Said About ETH SpecificallyLee told Milk Road Ethereum could reach roughly $6,000 if Bitcoin hits $150,000, calling that a conservative estimate rather than an aggressive one.Meanwhile, Hayes told Cointelegraph that Ethereum currently offers the best risk-reward in crypto, saying ETH could deliver a 3x to 5x move quickly.He added that rival asset Hyperliquid as measured by Hyperliquid Strategies (NASDAQ:PURR) no longer offers the same relative upside it once did, making ETH the cleaner trade at current levels.Image: Shutterstock