A Death Cross is the inverse of the Golden Cross: the 50-day SMA falls below the 200-day SMA, signalling that near-term momentum has deteriorated relative to the long-run trend. It is widely covered in financial media as a warning sign for stocks.
Like all moving average crossovers, the Death Cross is a lagging indicator. It often fires after a significant portion of the decline has already occurred — meaning the news is partly backward-looking. Markets have also recovered strongly from many Death Crosses, particularly when the signal appeared after a sharp panic-driven drawdown rather than a gradual deterioration.
The honest assessment is that the Death Cross has a mixed track record as a standalone signal. It has flagged some significant bear markets, but it has also produced false signals in correction-and-recovery sequences. Treating it as one input in a broader systematic model — rather than a hard sell trigger — is the more defensible approach.