Golden Cross

The golden cross occurs when a short-term moving average crosses over a major long-term moving average to the upside and is interpreted by analysts and traders as signaling a definitive upward turn in a market.

There are three stages to a golden cross:

• A downtrend that eventually ends as selling is depleted
• A second stage where the shorter moving average crosses up through the longer moving average
• The continuing uptrend, hopefully leading to higher prices.