New Delhi, Aug. 11 -- The Nifty 50-gold ratio, which measures the relative movement of the domestic stock market and gold, has narrowed to 1.6, hinting that the Indian equities may be oversold at the current juncture and perhaps poised for a rebound.

Domestic spot gold prices are up 13% year-to-date compared to a 6% fall in equity benchmark Nifty 50.

Based on the Nifty's previous close of 24,584 and domestic spot gold prices of Rs.1,50,208 per 10 grams on August 10, the Nifty-to-gold ratio has slipped further to 1.6. Historically, whenever the ratio has fallen below 2.5, the benchmark index has tended to witness a healthy upside.

The current Nifty-gold ratio at 1.6 has caught experts' attention, as they point out that historically, whe...