Chart of the Day - Monday, March 27th, 2023

Today’s Chart of the Day was shared by Larry Thompson (@HostileCharts). It's a ratio chart of the Equal Weight S&P 500 vs the traditional Cap Weight S&P 500 (RSP/SPX). Breadth has become a concern in recent weeks, as a handful of Mega Cap Tech stocks have been doing most of the heavy lifting within the S&P 500. As a result, Equal Weight is on track for its second worst month relative to Cap Weight in the past 25-years. Larry points out that this ratio is currently testing a potential support level around 0.035%. As you can see, this level has been a key inflection point in recent years. Bulls would welcome a bounce from this ratio, as it would represent broadening participation as opposed to the narrow Mega-Cap leadership we've had so far this month.