S&P 500   5,026.61
DOW   38,671.69
QQQ   437.05
Israel's finance minister blasts Moody's downgrade of the the country's credit rating
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Biden's campaign joins TikTok, even as administration warns of national security concerns with app
S&P 500   5,026.61
DOW   38,671.69
QQQ   437.05
Israel's finance minister blasts Moody's downgrade of the the country's credit rating
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Laser breakthrough could send stock soaring 2,467% (Ad)
Recession risks are fading, business economists say, but political tensions pose threat to economy
Biden's campaign joins TikTok, even as administration warns of national security concerns with app
S&P 500   5,026.61
DOW   38,671.69
QQQ   437.05
Israel's finance minister blasts Moody's downgrade of the the country's credit rating
Investing Wizard Who Turned $37K Into $2.7M in Just 4 Years Makes His Next Big Move (Ad)
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Venezuela defends military buildup, accusing neighboring Guyana of granting illegal oil contracts
Stock market today: World shares mostly higher after S&P 500 tops 5,000
Laser breakthrough could send stock soaring 2,467% (Ad)
Recession risks are fading, business economists say, but political tensions pose threat to economy
Biden's campaign joins TikTok, even as administration warns of national security concerns with app
S&P 500   5,026.61
DOW   38,671.69
QQQ   437.05
Israel's finance minister blasts Moody's downgrade of the the country's credit rating
Investing Wizard Who Turned $37K Into $2.7M in Just 4 Years Makes His Next Big Move (Ad)
Mardi Gras beads are creating a plastic disaster in New Orleans. Are there green alternatives?
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Better Than Oil Stocks (Ad)
Venezuela defends military buildup, accusing neighboring Guyana of granting illegal oil contracts
Stock market today: World shares mostly higher after S&P 500 tops 5,000
Laser breakthrough could send stock soaring 2,467% (Ad)
Recession risks are fading, business economists say, but political tensions pose threat to economy
Biden's campaign joins TikTok, even as administration warns of national security concerns with app

Golden Cross Stocks

A golden cross occurs when a stock's 50-day moving average crosses above its 200-day moving average. This page tracks stocks that have set golden crosses sometime within the last seven days. Learn more about golden crosses.

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CompanyCurrent Price50-Day Moving Average200-Day Moving AverageVolumeAverage VolumeIndicator(s)
Accolade, Inc. stock logo
ACCD
Accolade
$13.46
+1.1%
$11.77$10.90518,600921,518Gap Down
Astria Therapeutics, Inc. stock logo
ATXS
Astria Therapeutics
$15.00
-1.7%
$8.43$7.39481,600839,932Positive News
Bullfrog AI Holdings, Inc. stock logo
BFRG
Bullfrog AI
$5.01
+9.2%
$3.64$3.34395,0005.54 millionUpcoming Earnings
Cibus, Inc. stock logo
CBUS
Cibus
$18.28
-2.5%
$16.87$16.4157,40048,221Positive News
Aspira Women's Health Inc. stock logo
AWH
Aspira Women's Health
$4.81
+3.0%
$4.09$4.1643,40043,943Positive News
Gap Up
BRP Group, Inc. stock logo
BRP
BRP Group
$24.34
+5.0%
$23.31$23.19288,700362,529
Black Diamond Therapeutics, Inc. stock logo
BDTX
Black Diamond Therapeutics
$4.23
-5.4%
$3.03$2.87387,900572,736Positive News
Certara, Inc. stock logo
CERT
Certara
$17.23
+2.2%
$16.62$15.52370,800527,311Positive News
CytomX Therapeutics, Inc. stock logo
CTMX
CytomX Therapeutics
$1.52
+4.1%
$1.53$1.43187,400361,100
Cerus Co. stock logo
CERS
Cerus
$2.36
+2.6%
$1.96$1.801.13 million1.24 millionPositive News
Gap Up
Franklin Electric Co., Inc. stock logo
FELE
Franklin Electric
$99.48
+1.8%
$94.88$92.47121,500169,039Upcoming Earnings
Positive News
Acacia Research Co. stock logo
ACTG
Acacia Research
$4.36
+2.3%
$3.90$3.76277,300160,511
Cardiff Oncology, Inc. stock logo
CRDF
Cardiff Oncology
$1.81
+0.6%
$1.52$1.48129,900179,564Positive News
Elevation Oncology, Inc. stock logo
ELEV
Elevation Oncology
$3.00
+3.4%
$1.60$1.01857,8005.58 millionPositive News
FMED
Fidelity Disruptive Medicine ETF
$25.01
+0.2%
$23.76$22.885,8005,357Positive News
Amdocs Limited stock logo
DOX
Amdocs
$89.76
+0.3%
$89.20$86.58683,000610,700Earnings Report
Dividend Increase
FAT Brands Inc. stock logo
FAT
FAT Brands
$9.32
-0.9%
$6.79$6.7318,70028,539
Genfit S.A. stock logo
GNFT
Genfit
$3.67
+3.1%
$3.71$3.493,00029,571Gap Up
IO Biotech, Inc. stock logo
IOBT
IO Biotech
$1.63
-11.9%
$1.69$1.51992,200118,318Positive News
Gap Up
High Trading Volume
Doximity, Inc. stock logo
DOCS
Doximity
$28.59
+1.2%
$27.75$25.127.10 million2.12 millionAnalyst Report
Options Volume
Gap Down
High Trading Volume
Incyte Co. stock logo
INCY
Incyte
$57.66
+0.5%
$61.03$59.831.76 million1.57 millionUpcoming Earnings
Ocular Therapeutix, Inc. stock logo
OCUL
Ocular Therapeutix
$5.68
+12.9%
$4.33$3.613.69 million1.33 millionAnalyst Report
News Coverage
Gap Up
High Trading Volume
Golden Matrix Group, Inc. stock logo
GMGI
Golden Matrix Group
$3.35
+4.0%
$2.48$2.5734,30065,093Positive News
Minerva Neurosciences, Inc. stock logo
NERV
Minerva Neurosciences
$10.33
+8.5%
$7.38$7.1364,50055,411
Immatics stock logo
IMTX
Immatics
$11.39
+0.8%
$10.76$10.61314,600575,700
Reynolds Consumer Products Inc. stock logo
REYN
Reynolds Consumer Products
$28.43
-0.3%
$27.09$26.69571,600373,271Earnings Report
Atai Life Sciences stock logo
ATAI
Atai Life Sciences
$1.73
-1.1%
$1.60$1.47673,6001.64 million
Nuvei Co. stock logo
NVEI
Nuvei
$26.81
+3.0%
$24.59$20.55304,400403,893Positive News
Organigram Holdings Inc. stock logo
OGI
Organigram
$2.28
+5.1%
$1.55$1.421.37 million1.05 millionUpcoming Earnings
News Coverage
OptiNose, Inc. stock logo
OPTN
OptiNose
$1.34
+6.3%
$1.27$1.24544,500273,025Positive News
Mid-Southern Bancorp, Inc. stock logo
MSVB
Mid-Southern Bancorp
$13.45
-0.8%
$10.77$10.433,90016,236Upcoming Earnings
Oxford Square Capital Corp. stock logo
OXSQ
Oxford Square Capital
$3.07
+1.3%
$2.96$2.99239,000245,296Positive News
NRx Pharmaceuticals, Inc. stock logo
NRXP
NRx Pharmaceuticals
$0.51
+10.3%
$0.41$0.342.24 million590,504Gap Up
High Trading Volume
SunOpta Inc. stock logo
STKL
SunOpta
$6.17
-0.6%
$5.52$4.73584,600733,293Positive News
Territorial Bancorp Inc. stock logo
TBNK
Territorial Bancorp
$9.31
$10.51$9.649,40020,546
Invesco S&P SmallCap Health Care ETF stock logo
PSCH
Invesco S&P SmallCap Health Care ETF
$42.04
+0.9%
$41.42$39.6417,10024,354Positive News
Rail Vision Ltd. stock logo
RVSN
Rail Vision
$10.53
-9.1%
4.153.61358,50010.97 millionPositive News
Arrowhead Pharmaceuticals, Inc. stock logo
ARWR
Arrowhead Pharmaceuticals
$32.56
+5.5%
$31.39$29.001.46 million1.80 millionEarnings Report
Analyst Revision
Pyxis Oncology, Inc. stock logo
PYXS
Pyxis Oncology
$4.48
+20.8%
$2.45$2.131.63 million759,125Analyst Report
Gap Up
High Trading Volume
PepGen Inc. stock logo
PEPG
PepGen
$14.66
-2.8%
$7.83$6.2454,800156,500Gap Down
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TG Therapeutics, Inc. stock logo
TGTX
TG Therapeutics
$14.74
+0.7%
$16.59$12.423.81 million5.51 million
Global X NASDAQ 100 Covered Call ETF stock logo
QYLD
Global X NASDAQ 100 Covered Call ETF
$17.86
$17.46$17.282.38 million2.88 millionPositive News
U.S. Gold Corp. stock logo
USAU
U.S. Gold
$3.49
+0.6%
$3.82$3.6422,20029,768
Entrada Therapeutics, Inc. stock logo
TRDA
Entrada Therapeutics
$15.13
+4.3%
$14.97$15.0743,40069,329Positive News
Trip.com Group Limited stock logo
TCOM
Trip.com Group
$39.59
+1.5%
$35.87$36.092.00 million3.57 millionGap Up
Spero Therapeutics, Inc. stock logo
SPRO
Spero Therapeutics
$1.37
+1.5%
$1.42$1.3165,200191,789
Value Line, Inc. stock logo
VALU
Value Line
$42.03
-2.8%
$46.31$45.9416,8003,518Gap Up
High Trading Volume
PriceSmart, Inc. stock logo
PSMT
PriceSmart
$78.86
+0.7%
$75.00$74.15159,800161,736Dividend Announcement
Positive News
Service Properties Trust stock logo
SVC
Service Properties Trust
$7.76
+0.5%
$8.08$7.85580,400697,857
iShares 20+ Year Treasury Bond ETF stock logo
TLT
iShares 20+ Year Treasury Bond ETF
$93.85
-0.2%
$96.34$92.8427.95 million50.39 million
Texas Instruments Incorporated stock logo
TXN
Texas Instruments
$162.40
+1.4%
$165.01$161.203.92 million6.26 millionAnalyst Report
Analyst Revision
TransAct Technologies Incorporated stock logo
TACT
TransAct Technologies
$7.69
+0.5%
$7.29$6.954,20021,454
enVVeno Medical Corporation stock logo
NVNO
enVVeno Medical
$5.12
+18.8%
$4.36$4.68143,80066,025Upcoming Earnings
Gap Up
High Trading Volume
Precision Optics Co., Inc. stock logo
POCI
Precision Optics
$6.00
$6.11$6.051,6003,028Upcoming Earnings
Positive News
Xeris Biopharma Holdings, Inc. stock logo
XERS
Xeris Biopharma
$2.87
+5.1%
$2.35$2.122.16 million2.40 millionPositive News
ATS Co. stock logo
ATS
ATS
$40.20
-2.2%
$42.25$41.1568,00057,657Earnings Report
Barclays PLC stock logo
BCS
Barclays
$7.32
-0.4%
$7.59$7.437.54 million18.77 million
PagerDuty, Inc. stock logo
PD
PagerDuty
$25.16
+3.9%
$23.77$22.981.21 million1.67 millionPositive News
BigBear.ai Holdings, Inc. stock logo
BBAI
BigBear.ai
$1.85
+7.6%
$1.85$1.673.90 million2.41 million
United-Guardian, Inc. stock logo
UG
United-Guardian
$9.26
+4.2%
$7.89$7.5621,10011,311Ex-Dividend
Kenon Holdings Ltd. stock logo
KEN
Kenon
$23.68
$24.22$23.224,9006,761
Kirby Co. stock logo
KEX
Kirby
$85.02
+0.6%
$78.57$79.89371,400382,225
AllianceBernstein Holding L.P. stock logo
AB
AllianceBernstein
$33.21
+0.9%
$31.98$30.74289,200349,939Earnings Report
Dividend Increase
Commercial Metals stock logo
CMC
Commercial Metals
$54.11
+0.6%
$49.79$49.59813,0001.18 million
Entravision Communications Co. stock logo
EVC
Entravision Communications
$4.00
+2.3%
$4.12$3.96246,900246,957News Coverage
Positive News
Surrozen, Inc. stock logo
SRZN
Surrozen
$8.75
-7.1%
$8.67$8.075,10013,382Positive News
Gap Down
LXP Industrial Trust stock logo
LXP
LXP Industrial Trust
$9.01
-0.2%
$9.46$9.202.42 million2.22 millionUpcoming Earnings
Positive News
Redwire Co. stock logo
RDW
Redwire
$3.04
+0.3%
$2.91$2.9487,000176,207
CS Disco, Inc. stock logo
LAW
CS Disco
$8.02
+1.1%
$7.73$7.45125,300150,718
The Coca-Cola Company stock logo
KO
Coca-Cola
$59.56
-0.5%
$59.40$58.3915.24 million13.97 millionUpcoming Earnings
Canadian Pacific Kansas City Limited stock logo
CP
Canadian Pacific Kansas City
$85.31
-0.2%
$78.45$76.512.36 million2.47 million
Revolve Group, Inc. stock logo
RVLV
Revolve Group
$16.42
+4.9%
$15.77$14.971.12 million981,146
Vanguard Long-Term Treasury Index ETF stock logo
VGLT
Vanguard Long-Term Treasury Index ETF
$58.74
-0.2%
$60.11$57.961.60 million3.46 millionPositive News
Sphere Entertainment Co. stock logo
SPHR
Sphere Entertainment
$40.29
-0.9%
$33.77$35.51738,700754,200Earnings Report
Positive News
PBF Energy Inc. stock logo
PBF
PBF Energy
$53.35
+0.9%
$44.85$46.922.02 million2.29 millionUpcoming Earnings
Apartment Investment and Management stock logo
AIV
Apartment Investment and Management
$7.51
$7.61$7.26858,900824,029
NL Industries, Inc. stock logo
NL
NL Industries
$5.27
+1.7%
$5.31$5.1410,90015,518
TriplePoint Venture Growth BDC Corp. stock logo
TPVG
TriplePoint Venture Growth BDC
$10.85
-0.4%
$10.96$10.73126,100208,918Positive News
The Manitowoc Company, Inc. stock logo
MTW
Manitowoc
$16.86
-1.1%
$16.12$15.41239,200206,118Upcoming Earnings
UMH Properties, Inc. stock logo
UMH
UMH Properties
$14.80
+0.6%
$15.16$14.80300,400359,268
TELUS Co. stock logo
TU
TELUS
$17.56
+2.9%
$18.01$17.404.99 million2.31 millionEarnings Report
Gap Up
High Trading Volume
Satellogic Inc. stock logo
SATL
Satellogic
$1.35
+1.5%
$1.58$1.394,50034,896Positive News
Clearway Energy, Inc. stock logo
CWEN
Clearway Energy
$22.97
+0.1%
$25.62$24.16987,700932,321News Coverage
Veeva Systems Inc. stock logo
VEEV
Veeva Systems
$216.76
+0.6%
$195.29$195.97946,700966,250Analyst Revision
Oxford Lane Capital Corp. stock logo
OXLC
Oxford Lane Capital
$5.36
-0.6%
$5.07$5.062.29 million1.74 millionPositive News
PSCU
Invesco S&P SmallCap Utilities & Communication Services ETF
$52.34
+1.0%
$52.40$51.436001,939Positive News
Educational Development Co. stock logo
EDUC
Educational Development
$1.73
-2.8%
$1.30$1.248,10034,818Analyst Report
Gap Down
Electrovaya Inc. stock logo
ELVA
Electrovaya
$4.24
+6.0%
$3.42$3.21595,00074,143News Coverage
Gap Up
High Trading Volume
Graphite Bio, Inc. stock logo
GRPH
Graphite Bio
$3.02
$2.62$2.4774,000125,804Positive News
Harvard Bioscience, Inc. stock logo
HBIO
Harvard Bioscience
$4.73
+1.3%
$4.85$4.5044,00078,507
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Rimini Street, Inc. stock logo
RMNI
Rimini Street
$3.25
+3.5%
$3.26$2.75194,300291,368
Mueller Water Products, Inc. stock logo
MWA
Mueller Water Products
$15.23
+9.6%
$14.02$13.562.83 million814,532Earnings Report
Analyst Upgrade
Gap Up
High Trading Volume
SeaStar Medical Holding Co. stock logo
ICU
SeaStar Medical
$0.86
+6.2%
$0.59$0.517.10 million4.61 million
Precigen, Inc. stock logo
PGEN
Precigen
$1.40
+1.1%
$1.31$1.32650,3001.10 million
Sotera Health stock logo
SHC
Sotera Health
$16.27
+1.8%
$15.52$15.12412,400691,536
Viavi Solutions Inc. stock logo
VIAV
Viavi Solutions
$8.91
+2.4%
$9.61$9.282.04 million2.26 millionPositive News
Bread Financial Holdings, Inc. stock logo
BFH
Bread Financial
$35.46
+0.4%
$32.81$33.06494,000805,179Analyst Revision
Realty Income Co. stock logo
O
Realty Income
$52.76
-0.8%
$56.32$54.536.52 million8.43 million
golden cross stocks chart indicator

Key Points

  • The golden cross is a bullish breakout chart signal.  
  • The 50-period and-200 period moving averages are the defining characteristic of a golden cross.
  • The golden cross can be a breakout and uptrend indicator for your trades.
  • 5 stocks we like better than Amazon.com

You may have heard of a stock chart pattern called the golden cross. It’s usually mentioned in headlines when stock markets rally after a sharp or extended sell-off. It’s a technical chart indicator that bulls view as a reversal of the preceding downtrend.

The golden cross was in the news after the stock market bottomed in March 2020 and rallied higher into the reopening of the pandemic in 2021.

The golden cross preceded the powerful rally that surged the S&P 500 up through pre-COVID-19 levels. We’ll explain golden cross patterns, nuances and how to use them for your trades.

By the end of this article, you’ll be able to identify golden cross stocks. Whether you’re an investor or trader, they can be part of your arsenal to analyze stocks for potential trades thoroughly.  

What is a Golden Cross Signal?

What is a golden cross in stocks? A golden cross is a breakout chart pattern that indicates the reversal of a downtrend. The golden cross comprises a 50-period simple moving average (SMA) and a 200-period SMA.

The 50/200 is the defining characteristic of a golden cross. The 50-period SMA is the leader, and the 200-period SMA is the laggard. The period is the selected time increment such as weekly, daily, 60 minutes.

The conventional golden cross comprises a 50-day SMA performing a crossover up through the 200-day SMA.

“Day” and “period” are interchangeable as in 50-day moving average and daily 50-period moving average means the same thing. You will hear it commonly referred to using the "day" rather than "period" on TV and financial news headlines.

The term period is more convenient when dealing with intraday charts, as in the five-minute 50-period SMA, which is the same as the 50 five-minute SMA. In that case, it's much more clear calling it a five-minute 50-period SMA.

golden cross stock chart pattern

The golden cross is often used in the context of the general stock market or a benchmark index representing the general stock market. You often hear of the golden cross forming on the Dow Jones Industrial Average or the S&P 500 index. However, the golden cross occurs in stocks and other tradable financial assets.

The stock market golden cross forming on the benchmark indexes bodes well for almost all stocks. When a golden cross occurs in the indexes, they likely occur simultaneously in the stocks that comprise the index. This makes the golden cross signal on one index or stock open up the possibility of many more golden cross in stocks.

How Does a Golden Cross Form?

A golden cross is comprised of just two indicators. The short-term, or lead SMA, is the 50-period and the longer-term, or laggard SMA, is the 200-period. You can use many variations when it comes to the moving averages as long as they are the 50-period and the 200-period.

Some traders may prefer exponential moving averages (EMA) as they can give an earlier signal since recent trade prices carry more weight than older prices.

apple stocks chart

The golden cross forms when the 50-period MA crosses up and through the 200-period MA. The golden crossover indicates that a breakout occurs when it turns into an uptrend as the 50-period MA rises and starts pulling up the 200-period MA, which also rises slower.

The distance between the 50-period SMA and the 200-period MA is the trading channel and initially gets wider as the stock continues to make higher highs and higher lows on the uptrend.

The channel tightens when the stock starts slowing down. This means the 50-period MA starts to flatten as the 200-period MA catches up. From here, either another leg of the uptrend forms as the 50-period MA rises again or the 50-period MA turns and crosses the 200-period MA down, forming a breakdown.

How to Identify a Golden Cross Signal

Here are some ways to identify and confirm a golden cross signal or identify a stock golden cross.

Moving Averages to Identify a Golden Cross

The moving average crossover as the 50-period MA crosses up through the 200-period MA is the clearest sign of a golden cross. This breakout is the best way to identify a golden cross. It also presents two levels of price support moving forward.

The 50-period MA is the first support,  and the 200-period MA is the second and final support level. A rising 50-period MA is needed to confirm the breakout and subsequent uptrend.

golden cross stock chart

Technical Indicators to Identify a Golden Cross

Sometimes you can get head fakes or false breakouts on initial golden cross patterns. This can happen with the 50-period MA initially crossing up through the 200-period MA but then fizzling and falling back down again.

You can add momentum indicators to the chart to confirm the breakout. A momentum indicator like the relative strength index (RSI) will confirm the breakout by rising towards the 70-band. If the RSI fails to rise back up when the golden cross forms, it's considered a divergence signal that could result in a breakdown.

Train your eyes to identify what is a golden cross in the stock market.

Example of a Golden Cross

Let's look at an example of what is a golden cross in stock with Amazon.com Inc. (NASDAQ: AMZN).

Amazon stock chart

The 50-period MA in purple crosses through the 200-period SMA in blue as AMZN bounces up through $116. This is the breakout. AMZN makes higher highs and higher lows on pullbacks.

This lifts the 50-period MA higher as it uptrends. This, in turn, pulls the 200-period MA higher gradually. The channel between the 50-period MA and the 200-period MA continues to widen as the uptrend continues to rise.

The AMZN uptrend peaks at a high of $136.65 before prices dip down to $126.32.

How to Identify Golden Crosses on a Chart

Here are the steps to identify a Golden Cross pattern on a chart.

golden cross stock chart

Step 1: Select a stock and timeframe.

First and foremost, you have to select a stock. It can be anything from a penny stock to a dividend stock to a blue chip stock. It helps if the stock has a volume preferably over 100,000 shares average daily trading volume. In the above example, we chose Meta Platforms Inc. (NASDAQ: META) stock and the daily timeframe on a candlestick chart.

Step 2: Find the 50/200 moving averages.

A golden cross requires a 50-period moving average and a 200-period moving average. They are illustrated on the META daily chart by the 50-period MA line in purple and 200-period MA line in blue.

The purple line is the lead MA, and the blue line is the laggard MA, which means the purple line (50-period MA) will always react first and then be followed by the 200-period MA.

The 50-period MA is the first line of support, followed by the second support as the 200-period MA.

Step 3: Watch for the 50-period and 200-period MA crossover.

The 50-period MA starts below the 200-period MA at the beginning of the daily chart on the left side. This indicates that META was in a downtrend. Notice how the 50-period MA stopped falling around the $120 price level and then started to rise toward the 200-period MA.

The 50-period MA crosses up through the 200-period MA $171 as the relative strength index (RSI) oscillator bounces up to the 70-band.

Step 4: Confirm the trend with a rising 50-period MA.

After the breakout through $170, META continued to climb higher, making higher highs on bounces and higher lows on pullbacks. This causes the 50-period MA to rise. As it rises, the channel between the 50-period MA and the 200-period MA gets wider as the 50-period MA rises father away from the 200-period MA.

The RSI is also rising and maintains at or above the 70-band.

Pros and Cons of Golden Cross Stocks

Here are the good and not-so-good things to know about golden cross stocks.

Pros

The benefits of answering "What is golden cross in stocks?" include the following:

  • Bullish chart pattern: The golden cross is a much-loved stock pattern by investors since they are long the stock. You would be relieved if you've suffered a downtrend and it finally turns back up. The golden cross is akin to the calvary coming to the rescue.
  • Easy to identify: The golden cross is a relatively easy pattern since it only comprises two moving averages and a simple trigger. It's easily identified on a chart by the crossover of the 50-period MA through the 200-period MA.
  • Easy to apply: The golden cross pattern can be applied to any stock or trading instrument. It can also be applied to any timeframe. However, it is worth noting that wider timeframes carry more weight due to having more data points. Wider timeframes provide a smoother golden cross with sturdier supports, but shorter timeframes provide an earlier golden cross trigger signal.

Cons

Here are the negatives about golden cross stocks.

  • Lagging and late signal: The biggest argument about golden cross stocks is that a 50-period and a 200-period MA take so much time to get a signal that, often, it's considered a lagging signal. In the example of the META chart, we can observe META bouncing from a low of $88.41 to $171.43 before the golden cross forms. The stock more than doubled before triggering the golden cross signal. However, the stock rose to $318.68 before it peaked. Supporters will argue that the wider periods enable the golden cross pattern to smooth out the noise. There is a way to get an earlier signal on the golden cross by utilizing shorter time frames, which we will cover shortly.
  • False breakouts: A stock can trigger a golden cross breakout only to fizzle and break down again. This was the case in the example with MU stock. It did trigger a breakout at $91 as it immediately sold off to $75 before another bounce up to $95.50, and it fizzled into a breakdown as the 50-period MA crossed over down through the 50-period MA at $67. Golden crosses can be responsible for expensive entries that result in losses as the breakout fizzles and sells off.
  • Market conditions apply: The overall context of the stock market ultimately determines how strong a golden cross can be. If the market takes an abrupt downturn, it can cause golden cross formations to fizzle out and even reverse into a breakdown. Therefore, it's crucial to keep abreast of macro market conditions if taking a position using the golden cross indicator.

Try Smaller Timeframes for an Earlier Signal

You can use smaller timeframes for an earlier signal to address one of the major complaints about the pattern being a lagging indicator. Like a Doppler radar effect, the wider timeframes provide the general landscape, but a shorter timeframe, like an intraday 60-minute or 15-minute timeframe, provides a much earlier signal.

The caveat is that there will be more false signals and general "noise" when you use shorter time frames. This can be balanced by adding additional price indicators like Bollinger Bands to gauge price expansion or compression stages and momentum indicators like the relative strength index (RSI) to time entries.

FAQs

Here are answers to some frequently asked questions.

Is a golden cross good in stocks?

A golden cross is a bullish breakout signal, which is good for long positions. If you are holding a long position in a stock that triggered a golden cross, then you can gain from the impending uptrend.

The golden cross chart indicates the reversal of a downtrend and the creation and continuation of a new uptrend. If you are short-selling, it’s usually a sign to cover your short position. As you get more acclimated, you can look for golden cross stocks today routinely.

How do you use golden cross stocks?

The golden cross is a trend reversal indicator signaling a downtrend's end and an uptrend's start. You can use the golden cross as a potential buy signal when it returns to the 50-period MA or the 200-period MA. It's important to avoid chasing the golden cross signal as it may be relatively expensive when it signals.

It helps to add other price and momentum indicators when using this trading strategy.

Is golden cross trading profitable?

A golden cross trading strategy can be profitable depending on your entry and, most importantly, your exit. First, it's important to learn "What is a gold cross in stocks?" and "What does a golden cross mean in stocks?"It's best to have a trading or investing strategy. Use the golden cross as a breakout and uptrend signal with other indicators for confirmation and buy and sell triggers.

Jea Yu

About Jea Yu

  • JeaYu21@gmail.com

Contributing Author

Trading Strategies

Experience

Jea Yu has been a contributing writer for MarketBeat since 2018.

Areas of Expertise

Equities, options, ETFs and futures; fundamental, qualitative, quantitative and technical analysis and pattern identification; active and swing trading; trading systems and methodology development

Education

Bachelor of Arts, University of Maryland, College Park

Past Experience

U.S. equity markets trader, writer and analyst for over 25 years. Published four books by publishers McGraw-Hill, John Wiley & Sons, Marketplace Books and Bloomberg Press. Speaker at various expos and seminars and has been quoted and featured in USA Today, The Wall Street Journal, Traders Magazine, The Financial Times and various trade publications, including Stocks & Commodities, Active Trader and Online Investor.


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