The death cross, explained
A death cross is the day a stock’s 50-day average falls below its 200-day average. The name is dramatic. The figures below show what actually followed in Indian stocks.
What it measures
When the 50-day average drops below the 200-day average, prices over the last two to three months have fallen below the longer, ten-month trend.
How it is calculated
Each day, average the last 50 closes and the last 200 closes. The death cross is the first day the 50-day figure is lower, after being higher.
What happened next, in Indian stocks
These figures come from Sensifty’s monthly research and load here.
Why it is often late too
Like the golden cross, it is built from averages, so it appears after much of a fall has already happened. Selling on the cross alone can mean selling after much of the fall has happened.
What it does not tell you
It describes past prices only. Whether a fall continues depends on things the averages cannot see.
Related
Sensifty measures each of your stocks against its own history, and tells you once when a stretch cools off. Add to Chrome
Figures describe the past, among the 500 most traded NSE stocks at each date. They are not a forecast or a recommendation.