S&P 500 earnings expectations are stretched

The gap between forward and trailing earnings for the S&P 500 has reached the highest level in history.
That means the market is pricing in a very large improvement in future earnings compared with what companies have already delivered.
This does not automatically mean the market is wrong.
But it does mean expectations are doing a lot of work.
For $SPY, the next phase depends on whether earnings can actually catch up to the valuation story.
If they do, the rally has support.
If they do not, the market is vulnerable to a reset.