Chart of the Day - Tuesday, March 25, 2025

Patrick Dunuwila
March 25, 2025

Chart of the Day


🏆 Today's Chart of the Day was shared by Dylan Tanen (@hihotraders)
 

  • It's a ratio chart of the Consumer Discretionary sector versus the Consumer Staples sector on an equally weighted basis ($RSPD/$RSPS). This ratio is used to gauge risk appetite for the broader market. 
     
  • It's only Tuesday, but the ratio is on track for its best week since the election, with $RSPD outpacing $RSPS by +3.3%. Dylan points out that it has successfully retested former resistance from the 2021 peak. 
     
  • If this ratio had broken down, it would've been a major red flag for the broader market. However, it's bullish seeing former resistance turn into support here. 
     

The Takeaway: The Equal-Weight Consumer Ratio ($RSPD/$RSPS) successfully retested its prior cycle highs. If it holds, this is bullish for stocks, but a breakdown would be a major red flag. 

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