What Is Death Cross?
A death cross is the inverse of the golden cross: the 50-day moving average crosses below the 200-day MA. The implication is that short-term momentum has turned negative relative to longer-term, signaling a potential trend change to the downside.
Death crosses on major indexes (S&P 500, Nasdaq) get significant media attention but are even noisier than golden crosses. Several death crosses since 2010 occurred near intermediate lows that then reversed — including the March 2020 cross that coincided with the COVID bottom.
The signal works better as confirmation than as a leading indicator. By the time a death cross prints, significant damage has usually occurred. Better entries for bearish positions come from prior breakdowns or trendline breaks. Death cross is useful for regime filtering — staying out of long positions when the trend is structurally weak.
Related terms
- Golden Cross — Bullish technical signal when 50-day MA crosses above 200-day MA.
- Moving Average Crossover — Buy/sell signal when a fast moving average crosses above/below a slow one.
- Moving Average — A line plotted on a chart showing the average price over a chosen lookback period.
- Trend — The general direction of price movement over a period — uptrend, downtrend, or sideways.