Death Cross
A death cross is a technical chart pattern that occurs when a short-term moving average crosses below a long-term moving average. It is considered a bearish signal, suggesting that the market momentum is shifting to the downside.
The most common combination is the 50-day moving average crossing below the 200-day moving average. This pattern often follows a period of market euphoria or an uptrend, signaling a potential new bear market.
For crypto investors, the death cross is a warning sign of weakening demand and increasing supply. It indicates that the recent price trend is weaker than the long-term trend, suggesting a shift in market sentiment.
Like the golden cross, it is a lagging indicator, but it is taken very seriously by market participants. Traders often use it to reduce exposure or enter short positions.
It is a definitive signal of bearish market weakness.