This chart from DSP Netra tracks the NSE 500 Index over the last 25 years, showing its movement from around 600 to 20,000. It also highlights the number of stocks making new 52-week highs (green line) and new 52-week lows (orange line).
Current Market Condition
As of today, only 2 stocks in the NSE 500 have made a new 52-week high, while 155 stocks have hit a new 52-week low. Historically, when this number reaches around 200, the market tends to bottom out. Similar patterns were seen during previous major declines, including the COVID crash, demonetization sell-off, and the global financial crisis.
200-Day Moving Average Insights
Another important metric is the percentage of stocks trading above their 200-day moving average. Currently, only 10% (around 50 stocks) remain above this level, a sharp decline from nearly 80-85% just four months ago. In past market crashes, when this figure dropped into single digits, a bottom was usually formed.
Are We Nearing a Market Bottom?
Given that very few stocks are holding above key levels and new lows are dominating, this data suggests we may be approaching a market bottom. While the exact timing is uncertain, historical patterns indicate that major damage has already been done, and a phase of consolidation or recovery could be ahead.
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