From Yahoo Finance: 2025-04-14 14:12:00

A tariff-induced selloff in the U.S. stock market raises concerns about a “death cross” pattern, where the 50-day moving average falls below the 200-day moving average, signaling a potential longer-term downtrend. The S&P 500 saw this occurrence for the first time since February 1, 2023, following the Nasdaq Composite.

Despite the ominous sound of a death cross, historical analysis shows that buyers have been better off than sellers when this signal occurs in equity markets. Over 50 years, the S&P 500 has experienced 24 death crosses, with 54% of cases showing the worst of the decline happening before the death cross occurred.

Following a death cross, the benchmark index has experienced an average decline of 19%. However, there have been instances of more severe losses, such as declines of 21%, 45%, and 55% following death crosses in 1981, 2000, and 2007, respectively. The severity of the current selloff suggests that a selling crescendo may have already passed.

Despite the market’s recent turmoil, data analysis suggests that 30 days after a death cross, the S&P 500 tends to be higher 60% of the time, with an average gain of 0.8%. Analysts note signs of capitulation in the broader market, indicating that the worst may be over in terms of selling pressure.



Read more at Yahoo Finance: S&P 500’s ‘death cross’ may not be as ominous as it sounds, analysts say