Death Cross

The death cross is a bearish technical analysis pattern that occurs when a short-term moving average (typically the 50-day) crosses below a long-term moving average (usually the 200-day). This pattern suggests a potential long-term downtrend and is often viewed as a signal to sell. The death cross indicates that the market's momentum has shifted from bullish to bearish, with sellers gaining control over buyers.

Example

A trader sees the 50-day moving average of a stock crossing below the 200-day moving average, forming a death cross and signaling a potential downturn in the stock price.