Resources

Glossary

The vocabulary of the market climate, in plain English.

Forward EPS

Analysts' estimate of a company's (or index's) earnings per share over the next 12 months. For the S&P 500, we track forward 12-month operating EPS weekly. This is the expectations side of the market — what prices are built on.

Trailing EPS

Actual earnings per share over the last 12 months — the sum of the last four reported quarters. This is the reality side: what companies actually earned, not what anyone hopes they'll earn.

Expected EPS Growth

The year-over-year change in forward EPS: F(t)/F(t−52w) − 1. Positive means earnings expectations are expanding; negative means they're contracting. The primary timing question of the whole system.

Trailing EPS Rate of Change

The quarter-over-quarter change in trailing 12-month EPS: TTM(t)/TTM(t−1 quarter) − 1. Positive means earnings momentum is accelerating; negative means it's fading. When the bars shrink toward zero or turn negative, momentum is dying.

Market Climate

Our read on the earnings environment, from the two indicators above. Green: expectations expanding and actual earnings accelerating. Red: expectations contracting or actual earnings declining.

Market Timing

Signals derived from turns in expected EPS growth — the moments expectations stop expanding and start contracting, or vice versa. Slow by design: it's a regime tool for investors, not a day-trading trigger.

Forward P/E

Price divided by forward EPS — what you're paying per dollar of expected earnings. When price outruns expectations, the multiple stretches; when expectations catch up, it compresses.