Consensus long-term (3–5y) S&P earnings-growth expectations work backwards as a signal: the BCA/FactSet chart McClellan overlays shows the troughs of analyst pessimism (~9.5% in 2009 and 2020) sitting on generational buying points, and the optimism peaks (~17% in 2021) on tops. The 08/2026 reading is a record ~19.5% — analysts have never expected more from the next half-decade.
The mechanism: LT growth estimates are extrapolation, so they peak after the good news is delivered and priced. A record expectation is a record hurdle — it doesn’t predict a crash, it defines how much future is already in the price and leaves earnings nowhere to surprise but down. The mirror of BofA Bull & Bear Indicator (positioning) and Call-volume extremes (flows): this one measures the story itself. Same asymmetry too — the pessimism troughs on the chart are cleaner buys than the optimism peaks are sells.