When the phrase ‘golden cross’ starts making headlines, seasoned investors pay attention. In 2025, this bullish technical indicator is once again in focus on the ASX and global markets. But what exactly is the golden cross, and how should Australian investors interpret it in today’s rapidly shifting economic landscape?
What Is a Golden Cross, and Why Does It Matter?
The golden cross occurs when a short-term moving average—most commonly the 50-day—crosses above a long-term moving average, typically the 200-day. This event is widely viewed as a bullish signal that a major uptrend may be underway. The logic is simple: when recent prices are rising faster than long-term averages, positive momentum is building.
- Historical significance: The golden cross has preceded major rallies on the ASX 200, S&P 500, and other major indices.
- Not just for stocks: This indicator is also tracked in commodities, ETFs, and even cryptocurrencies.
- Limitations: Like all technical signals, it’s not infallible—false signals can occur in sideways or volatile markets.
The Golden Cross in 2025: What’s Driving Its Popularity?
This year, golden crosses have been spotted across several blue-chip Australian stocks and the ASX 200 index itself. So, what’s behind this resurgence?
- Interest rate pivots: With the Reserve Bank of Australia hinting at potential rate cuts later in 2025, growth sectors like tech and consumer discretionary are gaining steam.
- Economic rebound: After a sluggish 2024, GDP forecasts have been revised upwards, and consumer sentiment is improving, helping fuel a broad-based rally.
- Increased retail trading: More Australians are using online platforms and robo-advisers, leading to heightened interest in popular technical indicators like the golden cross.
For example, in March 2025, CSL Limited’s share price completed a golden cross, with its 50-day moving average overtaking the 200-day for the first time since 2022. Within weeks, volumes spiked and the stock gained 7%, outperforming the broader ASX 200, which also posted a golden cross in April.
How Should Aussie Investors Use the Golden Cross?
While the golden cross can be a useful tool, it’s best used as part of a broader investing strategy. Here’s how to get the most out of it in 2025:
- Don’t go all-in: Use the golden cross as a confirmation signal rather than the sole basis for investment decisions.
- Pair with fundamentals: Cross-check the indicator against company earnings, macroeconomic data, and policy news.
- Watch for volume: A golden cross accompanied by strong trading volume can indicate a more robust trend.
- Be wary of whipsaws: In choppy markets, golden crosses can quickly reverse (a ‘death cross’ is the opposite signal, when the 50-day drops below the 200-day).
Many experienced traders set alerts for both golden and death crosses but rely on broader analysis—including sector trends, RBA policy statements, and global events—to decide when to buy or sell.
Golden Crosses and the Future: What to Watch in 2025
As the ASX 200 and key Australian stocks continue to flirt with golden crosses in 2025, investors should keep an eye on:
- RBA policy shifts: Any change in interest rate outlook could quickly impact market momentum.
- Corporate earnings: A strong reporting season could validate bullish signals, while earnings misses may trigger reversals.
- Global volatility: Events in the US, China, and Europe can ripple through Australian markets, affecting the reliability of technical signals.
With algorithmic trading and retail investor activity at record highs, technical indicators like the golden cross are more visible—and more scrutinised—than ever. For Australian investors, understanding the context and limitations of this indicator is key to riding the next potential uptrend without getting caught out by sudden reversals.
