Published on 1 Dec 2023 on Zacks via Yahoo Finance

Medallion Financial (MFIN) Just Flashed Golden Cross Signal: Do You Buy?

Medallion Financial Corp. (MFIN) is looking like an interesting pick from a technical perspective, as the company reached a key level of support. Recently, MFIN's 50-day simple moving average crossed above its 200-day simple moving average, known as a "golden cross."

Considered an important signifier for a bullish breakout, a golden cross is a technical chart pattern that's formed when a stock's short-term moving average breaks above a longer-term moving average; the most common crossover involves the 50-day and the 200-day, since bigger time periods tend to form stronger breakouts.

There are three stages to a golden cross. First, there must be a downtrend in a stock's price that eventually bottoms out. Then, the stock's shorter moving average crosses over its longer moving average, triggering a positive trend reversal. The third stage is when a stock continues the upward momentum to higher prices.