Cross of death at the S&P 500: Does a new stock market crash threaten us?

Cross of death at the S&P 500: Does a new stock market crash threaten us?

Analysts are alerted about the current market situation, in particular with regard to the US feature index S&P 500. This index, which depicts the development of 500 of the largest listed companies in the United States, has sent out a technical warning signal known as the "Cross of Cross". This signal occurs when the 50-day average falls below the 200-day average. This development could indicate an upcoming downward trend, especially in view of the historical data, which suggests that such a pattern is often associated with ongoing price losses. [OE24] reports that many investors are concerned because trust is undermined by political uncertainties and economic factors.

The occurrence of a death cross is interpreted as a sign of declining short -term market dynamics. Surprisingly, this is the first death cross at the S&P 500 since March 2022, which increases the current nervousness in the markets. Historical analyzes state that the S&P 500 was higher in about two thirds of the cases one year after a death cross - on average by 6.3 percent. However, more than half of the last 24 Crosses of Crosses were recorded before the signal. [Vermoegenszentrum] emphasizes that the current signal may be in conjunction with the economic tensions by the customs policy of the former US President Donald Trump, who has burdened international trade.

The role of stock exchange psychology

The uncertainties on the markets apparently increase emotional factors that influence the behavior of investors. Greed and fear, as central emotions, can strongly shape purchase and sales decisions. In phases of increased uncertainty, it is crucial to take a relaxed attitude. Investors should also pay attention to their cognitive distortions, which often lead to irrational decisions. For example, the herd instinct means that investors make decisions based on the behavior of others instead of using their own analysis. [DeltaValue] emphasizes that an understanding of stock market psychology can help make more rational decisions and to avoid emotional mistakes.

The combination of increased volatility, fear of recession and high uncertainty could lead to various market developments. Several scenarios are conceivable based on the current situation: a quick relaxation, a longer decline or a sideways movement with high volatility. The next time will be decisive, because the direction of the market will depend heavily on political and economic developments. Therefore, experts advise you to remain true to a well -thought -out investment strategy in order to counteract emotional decisions and not to lose sight of long -term success.