The Death Cross is a market chart pattern reflecting recent price weakness. It refers to the drop of a short-term moving average—meaning the average of recent closing prices for a stock, stock index, commodity or cryptocurrency over a set period of time—below a longer-term moving average. The crossover typically suggests that the downtrend in prices has momentum and will likely continue.The death cross can be used as an indicator by traders to help them determine when to sell or buy assets. For example, if an investor observes that the short-term moving average has crossed below the long-term moving average for stocks they are tracking, they may decide this is indicative of increased downward pressure on those stocks and may choose to sell their holdings. Alternatively, if an investor believes that a particular stock is undervalued at current levels, they may buy shares anticipating that prices will rebound as selling pressure wanes and the death cross reverses itself.
