Three popular stocks that the Death Cross tells us to avoid in this bull run

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Subscribe to enjoy similar stories. Bull markets, like the one we are witnessing, are typically characterised by rising investor confidence, widespread optimism, and a surge in stock prices. The Nifty 50 is heading higher to new highs of 26,000.

Many investors chase high returns during such periods, scouring for the next big winner. However, not all stocks thrive in bullish markets. Some stocks exhibit technical weaknesses even when the broader market is on an upswing.

Identifying these laggards can be crucial for avoiding potential losses in an otherwise bullish phase. One of the most reliable tools for identifying stocks that could underperform or even drop is the Death Cross—a technical pattern that signals a bearish shift in momentum. The Death Cross is a bearish technical pattern that occurs when a stock’s short-term moving average, typically the 50-Day Exponential Moving Average (DEMA), crosses below its long-term moving average, the 200DEMA.

This crossover is a sign that selling pressure is intensifying and often precedes a period of declining prices. While many traders rely on the Death Cross on daily charts, it might be better to analyse this pattern on weekly charts to capture long-term trend shifts. The following three stocks have formed the Death Cross on weekly charts, signalling weakness despite the broader market’s bullish momentum.

Once a strong contender in the telecommunications sector, Vodafone Idea has seen its fortunes wane in recent years. The merger of Vodafone India and Idea Cellular was aimed at creating a telecom giant, but the combined company has struggled with mounting debts and intense competition. From a technical perspective, the stock has been under pressure for years.