Recent levels of optimism may be starting to warn about a market top, said Charles Rotblut at the American Association of Individual Investors.
In a contrarian signal, the AAII Journal editor said on CNBC's "Squawk Box" on Wednesday: "Whenever you have bullish sentiment too high, we tend to see the markets underperform about a 2.73 percent gain for the S&P 500 over the next six months."
The near-term, postelection bullish peak of 49.9 percent was reached on Nov. 23, breaking above the typical historical range. In the final AAII survey ahead of Election Day, bullish feelings stood at 23.6 percent on Nov. 2, well below the typical range.
"Unlike other bull markets, we're not seeing this really excessive enthusiasm," Rotblut said, indicating there may be some legs yet for the rally, even as the Dow Jones industrial average on Tuesday finished about 25 points away from 20,000 for a 17th record close since the election.
In the latest AAII survey, bullish sentiment about the six-month direction of the stock market rose 1.5 percent last week, to 44.7 percent, coming in at the high-end of the historical range. At the same time, bearish feelings also increased, jumping 5.8 percent to a six-week high of 32.3 percent, but remained within the typical range.
Rotblut said there's "a bit more polarization right now," as many individual investors who were surveyed were cautious. "Some of them were enthused about it really reflecting Trump's potential changes. Others thought stock prices had risen too far, too fast. Some are taking a wait-and-see approach. So it's very mixed."
"I think a lot of investors want to see revenue growth and earnings growth to really support these stock prices," he said.