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📈 Indicators·beginner

Death Cross

When a short-term moving average (typically 50-day) crosses BELOW a long-term moving average (typically 200-day) — a major bearish signal.

A death cross is the bearish opposite of the golden cross. The 50-day moving average crosses BELOW the 200-day moving average, signaling that the long-term trend has shifted from up to down. Like the golden cross, the death cross is widely reported and watched by institutional traders. Death crosses on major indices have historically marked the start of recessions and bear markets. They're not perfect (lots of false signals on choppy assets), but they're good enough that pension funds and asset managers actually adjust risk based on them. The entry strategy is the same as the golden cross but inverted: don't short immediately on the cross — wait for the first PULLBACK back up to the 50 EMA, then short with a tight stop.

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Real trade example

BTCUSD printed a weekly death cross in early 2022 at around $42k. Price dropped to $15k over the following 10 months — a textbook death cross-led bear market.

Frequently asked about death cross

What is a death cross in trading?+
When a short-term moving average (typically 50-day) crosses BELOW a long-term moving average (typically 200-day) — a major bearish signal.
When will I see death cross used in real trading?+
On indices, major forex pairs, and crypto charts. Reported by financial media as a bearish event whenever it happens on a popular asset.
What is the most common mistake traders make with death cross?+
Panicking and selling everything on the death cross. The signal is real but it lags badly. Often the worst of the move has already happened by the time the cross prints.
What do experienced traders know about death cross that beginners don't?+
Death crosses on the WEEKLY chart are far more reliable than daily death crosses. A weekly death cross on SPX500 is one of the most reliable recession indicators in market history.

Related terms

Golden Cross

beginner

When a short-term moving average (typically 50-day) crosses above a long-term moving average (typically 200-day) — a major bullish signal.

Moving Average

beginner

A smoothed line showing the average price over a recent period — the most-used indicator in technical analysis.

Donchian Channel

advanced

A channel formed by the highest high and lowest low over a set period — used in classic breakout systems.

Heiken Ashi

intermediate

A modified candlestick chart that smooths price action — uses an averaged open and close to filter noise and reveal trends.

Supertrend

intermediate

A trend-following indicator based on ATR that plots a single line above or below price — line below means uptrend, above means downtrend.

Divergence

intermediate

When price moves in one direction but a momentum indicator moves in the opposite direction — a warning of trend exhaustion.

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