Key facts
- Only 60% of S&P 500 stocks are trading above their 200-day moving average.
- Market concentration is identified as a cause of fragility.
- Narrowing market breadth indicates potential vulnerability.
The concentration of market gains in a few large stocks can mask underlying weakness in the broader market. When a significant portion of stocks falls below key technical indicators like the 200-day moving average, it suggests that the rally is not broadly supported and could be more susceptible to a downturn.