Check out the stocks that are carrying ‘Golden Cross’ and ‘Death Cross’ marks

by 5paisa Research Team Last Updated: Dec 12, 2022 - 02:16 pm 35.4k Views
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The Indian stock markets are reeling under the impact of the ongoing war in Europe that has put global crude oil prices on the boil with significant implications for local companies that depend on fuel to run their business.

The benchmark indices skid again on Monday and are now trading at levels last seen in August 2021 with a correction of around 15% from the peak.

The bloodbath in the mid and small caps has been much more brutal with several companies seeing their share price decline by 30% or more from their recent peaks.

Investors looking at charts and price and volume patterns have various parameters to decide whether a stock is ripe for the pick or is best left untouched.

One of the technical marks to pick or move away from a stock is to see which ones have a ‘golden cross’ and which others have the ‘death cross’ etched on their back. Both use the concept of moving averages to show trend lines on what the charts foretell about the possible future trajectory of a stock.

The Golden Cross strategy picks stocks whose simple moving average, or SMA, for the last 50 days has crossed above their SMA for 200 days. This is seen as a critical technical indicator for stocks that could be in the bullish zone.

On the flip side, the Death Cross strategy picks stocks whose 50-day SMA has sunk below their 200-day SMA. This is seen as a critical technical indicator for stocks that could be in the bearish zone.

We ran an exercise to see which stocks carry which of the two marks.

The Golden Cross stocks list includes name like Honeywell Automation, Jindal Steel & Power, Biocon, MMTC and Intellect Design Arena, besides a whole host of small and micro-cap firms.

Another way to look at these names is to see which of these companies have achieved the ‘crossover’ more recently as this could indicate they are still in the way up as against others that could have seen the crossover few weeks back and now are in the reversal zone.

Here we get names like Bharat Rasayan, JK Paper and MMTC that have seen the crossover over the last one week.

On the other hand, the Death Cross basket has many more large names including FMCG major Nestle, cement producer Ultratech, Torrent Pharma, ACC, Piramal Enterprises, Kotak Mahindra Bank, Godrej Properties, Cyient, UPL, Adani Ports, Finolex, Indus Towers, Ashok Leyland and Indiabulls Real Estate.

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