Market performance in February 2026 continues to lean heavily on the 200-day moving average (DMA) as a critical barometer for long-term health. This indicator, which averages closing prices over the last 200 trading sessions, is currently revealing a significant divergence between headline index levels and the health of individual stocks. In the U.S. market, the S&P 500 is trading near the **6,843** level as of mid-February. While the index remains in a broader uptrend, internal breadth is showing signs of strain. Recent data indicates that approximately **64%** of S&P 500 stocks are trading above their 200-DMA, down from higher levels seen earlier in the cycle. The technology sector is experiencing a "hidden breakdown" within this framework. Despite some mega-cap stability, roughly **57%** of S&P 500 technology companies are now trading below their 200-DMA. This suggests a loss of momentum for a majority of tech firms, even as the primary indices stay afloat. Across global markets, specifically in India, the Nifty 50 and Sensex have faced recent pressure, with the Sensex closing near **82,626**. Technical scans show a selective recovery; on February 17, only **13** major stocks in the Nifty 500 pack successfully crossed above their 200-DMA, signaling potential breakouts for those specific names. Traders utilize the 200-DMA to separate "noise" from true trend shifts. When a stock price stays above this line, it is viewed as a sustained uptrend. Conversely, falling below it often triggers defensive selling. For example, high-profile names like Reliance Industries and HDFC Bank have recently been flagged for trading below this long-term average. The 200-DMA also functions as psychological support. In a "buy the dip" environment, prices often bounce after touching this average. However, if an index like the Nifty IT plunges—as it did by over **8%** in a single week this month—the 200-DMA serves as a "ceiling" or resistance level that must be reclaimed to prove a trend reversal. Current sentiment for 2026 remains cautious but opportunistic. Analysts point out that while valuations have corrected to around **20 times** trailing earnings, the market is waiting for broader participation. The reliance on the 200-DMA is expected to intensify as investors look for confirmation that the current bull cycle has the durability to continue through the second half of the year.