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S&P 500 and Nasdaq Confirm 'Death Cross' as Analysts Debate Market Outlook

The technical signal raises concerns about potential declines, but historical data and short-term indicators suggest a possible recovery.

A screen displays the Dow Jones Industrial Average at market close, after Republican presidential nominee Donald Trump became U.S. president-elect, at the New York Stock Exchange, in New York City, U.S., November 6, 2024. REUTERS/Andrew Kelly/File Photo
A view shows the New York Stock Exchange (NYSE) Wall Street entrance in New York City, U.S., April 7, 2025. REUTERS/Kylie Cooper/File Photo
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A specialist trader works at his post on the floor at the New York Stock Exchange (NYSE) in New York, U.S., July 16, 2019.

Overview

  • Both the S&P 500 and Nasdaq have confirmed the 'death cross,' where the 50-day moving average drops below the 200-day moving average.
  • Historical analysis shows the death cross has led to mixed outcomes, with 54% occurring after peak declines and 46% preceding further selloffs averaging a 19% drop.
  • Some analysts argue the pattern could signal a buying opportunity, with comparisons to past V-shaped recoveries in 2018 and 2020.
  • Short-term momentum improvements and MACD buy signals indicate the potential for a relief rally in the coming weeks.
  • The death cross pattern has also been observed in other markets, including bitcoin and Nvidia, highlighting its broader occurrence across asset classes.