Concept
Death Cross
Death Cross is a Trend concept. The Library holds 3 implementations, each one a working definition you can pull into Quant.
Top Death Cross indicators
3 total
What is a Death Cross?
A death cross is the bearish counterpart of the golden cross: a shorter moving average crossing below a longer one, classically the 50-day simple moving average dropping under the 200-day on a daily chart. It records that intermediate-term price action has deteriorated enough to pull the medium average through the long-term one, which by construction happens well after the decline begins. It is a statement about regime, delivered late, not a prediction about the next few weeks.
Its notoriety comes from the name and the headlines more than from its track record. Because it needs a prolonged fall to trigger, death crosses have printed early in extended bear markets but also near exhausted lows just before recoveries, and historical outcomes are mixed. Practitioners who use it mostly treat it as a risk flag inside a broader trend regime label, not as a standalone sell signal.
How traders use it
- As a de-risking trigger in longer-horizon portfolios: reduced position sizes, tighter stops, or hedges while the 50-day holds below the 200-day.
- As a directional filter: long setups are disabled or downweighted under a standing death cross, and short setups are given more room.
- As a screening condition to flag symbols whose long-term trend has rolled over for closer review.
Related concepts · MA applications
Concept family
Trend
100 concepts mapped · 88 in the Library
Death Cross FAQ
What is the difference between a death cross and a golden cross?
They are the same event in opposite directions on the same pair of averages, conventionally the daily 50 and 200 SMA. The death cross is the 50 crossing below the 200 and is read as a bearish regime shift; the golden cross is the 50 crossing back above the 200 and is read as a bullish one. Both lag price substantially.
Should you sell when a death cross appears?
Not automatically. The cross confirms damage that already happened, and markets have sometimes bottomed soon after one printed. It is more defensible as a prompt to review exposure, stops, and position size than as a mechanical exit; whether to sell depends on your timeframe and the rest of the evidence in front of you.
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