- Wealth PMS
In the MarketVision Chronicle, I’ve posted that the Advance-Decline count is a useful thing to look at. Advances are stocks that go up in the day compared to yesterday’s close, and declines are those that go down. Subtracting them gives us an A-D number, which is spiky so we add it up from a long ago date.
It’s wrong to compare the charts with each other since they are of wildly different scales (and depends on the starting point). But you can see from the graph above that the Nifty has made a low that is about 12-18 months old, and bounced off from there.
The A-D counter, though, has made a 2 year low. This means the recent drop was broad – not limited to a few stocks. Plus, since it’s still substantially above zero, there may be more pain for us waiting, even if the index recovers a little bit now.