New Delhi, Sept. 10 -- Gold's massive run has undoubtedly eclipsed the equity market returns this year, with the prices up nearly 100% in the last two years, as against a 26% rise in the Nifty 50 index. However, this bull run in gold and underperformance by equities has created an interesting pattern on the technical charts - one that spells good news for stock market investors.

According to an analysis by Rahul Sharma, Director & Head - Technical & Derivative Research, JM Financial Services, the Nifty-gold ratio has entered the most oversold in five years, a pattern last seen thrice over 25 years. In the past, such a technical setup has unleashed stock market bulls, resulting in an average of 125% returns in 28 months.

In the past, the...