Spotting Potential Sell Signals with the Death Cross!

Last week, Cici explained how to identify a bullish trend by using the "Golden Cross."

To put it simply, the death cross appears on a chart when a short-term moving average (e.g. MA20) crosses below a long-term moving average (e.g. MA60). This  may represent a strong short-term downward momentum and  a bearish movement for stock prices.

Here we sue MA20 and MA60 as examples. Also, investors can customize the time frame of moving averages according to their investment horizons, whether that’s short, medium, or long-term:

In general, short-term moving averages are more sensitive to price changes compared to others, making them react faster when price trends reverse.

However, we should also be aware that moving averages are lagging technical analysis indicators which only reflect the historical trend of stock prices. Therefore, combining other technical analysis tools with moving averages could help traders make well-informed trading decisions.