Circuit Limits (Price Bands)
On NSE, a circuit limit (price band) is the maximum percentage a security's price is allowed to move in a single trading session, measured from the previous day's closing price. The upper limit caps how far the price can rise (the "upper circuit") and the lower limit caps how far it can fall (the "lower circuit"); orders priced beyond these bounds are not accepted. At the index level, separate market-wide circuit breakers can halt trading across the whole market for a set duration when a benchmark index moves by a large pre-defined percentage.
Also called: Price Bands, Price Band, Circuit Limit, Circuit Limits, Upper Circuit, Lower Circuit, Upper Circuit Limit, Lower Circuit Limit, Daily Price Band, Price Band Limit, Market-Wide Circuit Breaker, Index Circuit Breaker, Circuit Breaker
How it is read
A stock "hitting upper circuit" or "hitting lower circuit" means its price has reached the day's band edge, so trades can occur only at or inside that edge for the rest of the session, and one-sided order flow can leave buyers or sellers without a counterparty. Common stock bands are 2%, 5%, 10% or 20%, assigned by the exchange; many securities in the derivatives (F&O) segment instead operate under dynamic price bands that the exchange can flex during the day rather than a single fixed daily band. Market-wide index breakers on the benchmark index are typically structured at 10%, 15% and 20% thresholds, each pausing trading for a duration that depends on the trigger level and the time of day it occurs. Traders generally read a circuit as a sign of a sharp, one-directional imbalance and a temporary limit on tradability rather than a settled "true" value.
What it does not tell you
A circuit limit only bounds the day's price range; it does not indicate why the move happened, whether it reflects fundamentals, news, or low-liquidity order flow, and it says nothing about where the price will go next. Hitting a circuit does not guarantee a fill: when a stock is locked at upper or lower circuit, orders can sit unexecuted because there is little or no opposing volume. The band is recalculated each day from the prior close, so a stock can move through several "circuits" over consecutive sessions; the band edge is an administrative limit set by the exchange, not a support or resistance level derived from trading, and dynamic-band or F&O securities may not behave like fixed-band stocks. Index circuit breakers and individual stock price bands are separate mechanisms and should not be conflated.
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