Your question was how to detect the intersection of two panels and change the cursor. Here is an example of how to do that
public static void overlapTest() {
final JPanel p1 = new JPanel();
final JPanel p2 = new JPanel();
p1.setBackground(Color.RED);
p2.setBackground(Color.BLUE);
final JPanel container = new JPanel();
container.setLayout(null);
container.add(p1);
container.add(p2);
p1.setBounds(0,0,120,100);
p2.setBounds(80,0,120,100);
Dimension size = new Dimension(200,100);
container.setPreferredSize(size);
container.addMouseMotionListener(new MouseMotionListener() {
@Override
public void mouseDragged(MouseEvent arg0) {
}
@Override
public void mouseMoved(MouseEvent e) {
Point pt1 = e.getPoint();
pt1.translate(-p1.getX(), -p1.getY());
Point pt2 = e.getPoint();
pt2.translate(-p2.getX(), -p2.getY());
if (p1.contains(pt1) && p2.contains(pt2)) {
System.out.println("both contain: " + e.getPoint());
container.setCursor(Cursor.getPredefinedCursor(Cursor.W_RESIZE_CURSOR));
}
else{
container.setCursor(Cursor.getPredefinedCursor(Cursor.DEFAULT_CURSOR));
};
}
});
}