The golden cross is the most quoted signal in financial news. When the S&P 500’s 50-day average climbs over its 200-day, someone writes that a new bull market has been “confirmed”. When it drops back under, the death cross gets the scary headline.
So I tested it on every trading day since 1970: 56 years, 27 closed trades.
The rules
- Buy when the 50-day moving average closes above the 200-day moving average (the golden cross).
- Sell when the 50-day closes back below the 200-day (the death cross).
- Simple moving averages of the daily close. Long only; in cash between trades.
Market: S&P 500 index (^GSPC), price only, dividends not included.
The result
| Golden cross | Buy-and-hold | |
|---|---|---|
| Annual return | 7.49% | 8.41% |
| Total return | 5583% | 9072% |
| Max drawdown | −33.9% | −56.8% |
| Worst fall, from – to | Feb 2020 – Mar 2020 | Oct 2007 – Mar 2009 |
| Time in the market | 73% | 100% |
| Trades | Value |
|---|---|
| Closed trades | 27 (+1 open) |
| Winners | 22 (81.5%) |
| Average winner | +22.56% |
| Average loser | −6.21% |
| Win/loss ratio | 3.63 |
| Profit factor | 15.99 |
| Best / worst trade | +115.8% / −10.8% |
| Average holding time | 369 sessions |
My read
The win rate looks great: 81% of trades made money. That is what a slow signal does. It sits in the market for about 18 months at a time, and in a rising index most long stretches end higher. The average winner was 22.6%, the average loser −6.2%.
It still made less than doing nothing: 7.49% a year against 8.41% a year for holding the index. What it bought was a smaller worst fall: 34% against 57% for buy-and-hold. The death cross took it out in Dec 2007 and it only came back in Jun 2009, so it missed the whole of 2008.
The price of being slow shows in 2020. The death cross came after the crash, and the test sold in Mar 2020, a week after the low, for a −9.9% loss.
My read: the golden cross is a trend filter, not an entry signal. It tells you which side of the market the wind is blowing from. It does not tell you when to click, and on its own it has not beaten the index.
Every trade
Open at the end of the data: bought Jul 2, 2025 at 6,227, +24.7% at the last close (Sep 22, 2026). Not counted in the trade statistics.
27 closed trades, newest first
| Bought | Price | Sold | Price | Result |
|---|---|---|---|---|
| 2023-02-03 | 4,136 | 2025-04-15 | 5,397 | +30.5% |
| 2020-07-10 | 3,185 | 2022-03-15 | 4,262 | +33.8% |
| 2019-04-02 | 2,867 | 2020-03-31 | 2,585 | −9.9% |
| 2016-04-26 | 2,092 | 2018-12-10 | 2,638 | +26.1% |
| 2015-12-22 | 2,039 | 2016-01-12 | 1,939 | −4.9% |
| 2012-02-01 | 1,324 | 2015-08-31 | 1,972 | +48.9% |
| 2010-10-25 | 1,186 | 2011-08-15 | 1,204 | +1.6% |
| 2009-06-24 | 901 | 2010-07-06 | 1,028 | +14.1% |
| 2006-09-13 | 1,318 | 2007-12-24 | 1,496 | +13.5% |
| 2004-11-08 | 1,165 | 2006-07-20 | 1,249 | +7.2% |
| 2003-05-15 | 947 | 2004-08-19 | 1,091 | +15.3% |
| 1999-11-12 | 1,396 | 2000-10-31 | 1,429 | +2.4% |
| 1998-12-09 | 1,183 | 1999-11-05 | 1,370 | +15.8% |
| 1994-09-16 | 471 | 1998-09-30 | 1,017 | +115.8% |
| 1991-02-19 | 369 | 1994-04-20 | 442 | +19.6% |
| 1990-05-29 | 361 | 1990-09-10 | 322 | −10.8% |
| 1988-06-29 | 271 | 1990-02-27 | 330 | +21.9% |
| 1986-11-26 | 249 | 1987-11-06 | 250 | +0.7% |
| 1984-09-13 | 168 | 1986-11-19 | 238 | +41.5% |
| 1982-09-29 | 122 | 1984-02-06 | 158 | +30.0% |
| 1980-06-18 | 116 | 1981-07-06 | 127 | +9.6% |
| 1979-03-22 | 102 | 1980-04-23 | 104 | +2.0% |
| 1978-05-23 | 98 | 1978-12-14 | 96 | −2.0% |
| 1977-01-05 | 105 | 1977-03-04 | 101 | −3.4% |
| 1975-03-07 | 84 | 1976-12-02 | 102 | +21.1% |
| 1972-01-27 | 104 | 1973-04-19 | 112 | +8.4% |
| 1970-10-23 | 84 | 1971-09-27 | 98 | +16.5% |
How it was tested
- Signals are read on the daily close; each trade happens at the next day’s close. No look-ahead.
- Long only, fully in or fully out. No commissions, slippage, interest or dividends.
- The test starts on the first day every indicator has a value (Oct 15, 1970); buy-and-hold covers the same days.
- Prices: Yahoo Finance daily data (^GSPC), snapshot
spx-2026-09-23.csv. Checked by a second, independent program before publishing.
Not financial advice. This is educational content, shared for information and entertainment only, and it is not a recommendation to buy or sell any asset. Backtests and past results do not guarantee future results, and the numbers or charts here may contain mistakes. Trading carries risk, including losing all the money you put in. Do your own research before you make any decision.