famous trader Peter Brandt A controversial statement recently about the technical analysis pattern known as the “golden cross” made. According to Brandt, this is nothing more than an exaggerated phenomenon with no real predictive utility in the market. This has led many to question the validity of the golden cross, a pattern that has been used in financial markets for decades.
A “golden cross” occurs when a shorter-term moving average, such as the 50-day moving average, crosses above a longer-term moving average, such as the 200-day moving average. This formation is considered a bullish signal and indicates that the stock or asset price will continue to follow an upward trend.
A Golden Cross is a fun talking point & nothing more. No real mkt predictive utility. Peer-reviewed and trader-tested research testify that there is nothing magic about the chart construction. pic.twitter.com/GBbBuFWExK
— Peter Brandt (@PeterLBrandt) February 15, 2023
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Cryptocurrency In the market, several popular assets, notably Shiba Inu, Ethereum, recently showed a gold cross formation. However, their price performance was not significantly affected by this pattern and they continued to move depending on other fundamental and technical factors.
Peter Brandt, who has more than forty years of trading experience and is considered an expert in technical analysis, is one of those who believes that the gold cross has no real market prediction utility. He states that “performance-audited and investor-tested research” has proven that there is nothing “magical” in the chart structure.
Koinfinans.com As we’ve reported, Brandt isn’t the only expert to be skeptical of the golden cross. Many other traders and analysts have expressed the view that the usefulness of the pattern is overrated and its predictive power is minimal. They argue that relying solely on technical indicators such as the golden cross can be dangerous and lead to missed opportunities or false signals.
Although the gold crossover is closely followed by many traders, many different factors such as market sentiment, current developments and economic indicators should always be taken into account. As a result, trading based solely on technical indicators will often be incomplete.