Small & Midcaps in India have had a bear phase since Jan 2018. See the chart below. The Smallcap 100 index has fallen from 9600 odd levels in Jan 2018 to almost 3100 in March 2020. Last 10 days Nifty has blasted 1000 points but small/midcaps have not moved much.
The moving averages have now aligned and the medium term outlook is bullish for the small/mid caps to catch up for years of underperformance. Let us see the ratio chart of Smallcaps vs Nifty.
See how the ratio chart has stalled at the exact level before the March crash. That level can play resistance in the short term. Once we break past that level expect small/mid caps to outperform Nifty. Till then this underperformance can continue.