A death cross occurs when a shorter-term moving average — typically the 50-day SMA — crosses below a longer-term one, typically the 200-day SMA. It signals that medium-term momentum has turned more negative than the long-term trend, and has preceded several major market declines, including 2008, 2020, and 2022.
Why it matters
- —Like the Golden Cross, it's a lagging signal — by the time it triggers, the decline that produced it is often already well underway.
- —Has historically preceded significant drawdowns at the index level, which is why it draws outsized media attention despite its lag.
- —On an individual stock, treat it as confirmation of weakness rather than a precise timing tool for an exit.
How to read it
| 50-day crosses below 200-day | Bearish long-term signal |
| Cross follows a sharp prior decline | Often confirms a trend already in progress |
| Cross on expanding volume | Stronger conviction behind the signal |