MA Golden Cross — Indicator dictionary

An event marker that puts a vertical line on the candle where the short moving average crosses up through the long one.

Weapon tier: Standard
Slots used: Candle markings 1/3

Concept

It compares the average close of the last 5 candles (the short line) with that of the last 20 candles (the long line). The candle where the short line moves from below the long line to above it is a "golden cross".

Because the short line reacts faster to recent prices, the cross is commonly read as "recent prices have started to rise above their longer average". Averages are built from prices that have already passed, though, so the cross always comes late.

MA Golden Cross
Simple Moving Average
Simple Moving Average

Charts by TradingView Lightweight Charts™

The cross happened on the candle with the yellow vertical line, and the price then rose slowly. This scene was picked because the price rose after the cross. It is just as common for the price to fall back right after a cross. The game does not draw the moving averages, only the vertical line — the two lines here were added to show the cross. Drag the chart sideways with a finger or the mouse to move it, and pinch with two fingers to zoom in. With a keyboard, click the chart, then use ←/→ to move and +/− to zoom.

How it is calculated

Short line = simple average of the last 5 closes, long line = simple average of the last 20 closes (the same lines as in lesson 3).

For every candle, take the gap between them (short line − long line).

If the gap was 0 or below on the previous candle and is above 0 on this one, this candle gets the event marker.

Parameters

What it sets	Name in the game	Default	Range
Candles in the short moving average	fast	5	1 – 100
Candles in the long moving average	slow	20	2 – 200

Trading ideas

A golden cross after a long downtrend is commonly used as a sign that "it is time to check whether the trend is changing". Check whether volume rose with it and whether highs and lows have started to climb (lesson 2).

Many traders trust a cross more when the long line itself is already pointing up. If the long line is still falling, they wait for more confirmation.

Common traps

In a sideways stretch the two lines tangle and crosses come one after another. Most of those crosses mean little.
It is built from averages, so it is late. By the time the cross appears, the price has often already risen a good way off the bottom.
The chart on this page was also picked because the price rose after the cross. Falling back after the same kind of cross is common, so read it together with the trend (lesson 2) and volume.

In the game

“MA Golden Cross” is a “Standard” weapon and uses 1 “Candle markings” slot (limit 3).
The game draws a faint grey vertical line in the price area on every candle where the event happens, and writes the weapon name only on the most recent line. It does not draw the two moving averages — equip Simple Moving Average as well if you want to see them.
The candle where the same two lines cross the other way is marked by “MA Dead Cross”.

Related indicators and lessons

MACD — A trend indicator that uses the gap between a fast and a slow exponential moving average to show whether the two averages are pulling apart or closing in.
Ichimoku Cloud — A trend indicator that uses five lines and a cloud to show at a glance where the price sits within its past price range.
Pivot Line — An indicator that uses the previous candle’s high, low and close to set five reference lines (Pivot, R1, R2, S1, S2) for the current candle in advance.
DMI — A trend indicator that shows, as two lines side by side, the force pushing highs higher (+DI) and the force pushing lows lower (−DI).
Parabolic SAR — An indicator that uses a single trailing “stop line” to show whether the price is in a rising or a falling stretch, and when it flipped.
Aroon — An indicator that judges whether a new trend has started by how long ago the recent high and low were made.
Supertrend — A trend indicator that keeps a single line above or below the price and uses its color and position to show whether the price is in an uptrend or a downtrend.
Exponential Moving Average — A line that averages recent closes with more weight on the newest ones, so it follows price changes faster than the simple moving average.
MA Dead Cross — An event marker that puts a vertical line on the candle where the short moving average crosses down through the long one.
ADX — An indicator that shows, as a number from 0 to 100, how strongly the price is moving in one direction, whether up or down.
3. Moving averages
2. Trends and sideways moves