Chart of the Day - Friday, January 22nd, 2021

Today’s Chart of the Day was shared on Twitter by Shane Murphy (@murphycharts). It's a ratio chart of the Momentum ETF, $MTUM vs. $SPY. The top holdings in $MTUM include Mega-Cap growth stocks like Tesla, Apple, Microsoft, Amazon, and Nvidia. Shane points out that this ETF broke out to an all-time high on both an absolute and relative basis today. The rotation back into Mega-Caps stocks was perhaps the most noteworthy aspect of this week's tape. As we discussed a couple of days ago, these juggernauts have been moving sideways for nearly five months now and are just starting to resolve higher. In a comment to The Chart Report, Shane said, "seeing these Mega-Cap growth stocks catch a bid for the first time in months definitely bodes well for the indices. But also, this pokes holes in the narrative that Value is making a meaningful comeback relative to Growth. It would be very difficult for Value to outperform Growth in an environment where these particular names are resolving higher."