Main points
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Tom Lee expects the S&P 500 to reach 7,700 by 2026.
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Lee believes that Ethereum is “significantly undervalued” at current levels.
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The bullish analyst claims that Bitcoin could reach highs of $250,000 within months.
Tom Lee of Fundstrat and BitMine said the S&P 500 and major cryptocurrencies are still poised for significant gains despite the market facing what he described as a volatile period of volatility.
In an interview with CNBC, Lee predicted that the S&P 500 could rise to 7,700 points by 2026. He also believes that Ethereum is “significantly undervalued” and could reach well over $12,000.
Separately, Lee reiterated his positive bullish outlook on Bitcoin, suggesting that it could reach highs of $250,000 within months.
Lee said his 7,700 target reflects a slowdown after several years of huge returns, while still implying a strong upward trajectory for U.S. stocks.
“We’re up 20% over three years because the S&P will probably close around 7,000 this year,” Lee said.
Despite near-term uncertainty, Lee believes the broader policy environment remains supportive of stocks.
“By the end of the year, the real message will be that the Fed is back to being relevant,” he said.
Lee warned that the market’s path higher could include a sharp bear market-like correction, especially if technology stocks lose momentum.
“I think there could be a bear market in 2026, but we’ll exit strong,” he said.
He cited several potential sources of volatility, including changes in leadership at the Federal Reserve, legal uncertainty surrounding tariffs and growing skepticism about artificial intelligence.
“Whenever technology starts to stagnate, people wonder, is this the end of leadership?” Lee said. “So is the market going to go down, or is this a rotation?”
Lee thinks the latter is more likely, suggesting market leadership could extend beyond giant tech stocks.
“People are more pessimistic now because the tech sector is stagnant,” he said, adding that deep-seated pessimism often occurs “in bear markets” even if prices eventually move higher.
Lee is particularly bullish on Ethereum, saying the asset is now starting to break out to higher levels after years of consolidation.
“Ethereum has been range-bound for five years, but now it’s starting to explode,” Lee said, noting that Fundstrat has increased its investment in the token.
