The best indicator for Japan (EWJ)
We backtested 20 indicators across daily, weekly and hourly charts on real Japan (EWJ) history. Here's what actually worked — risk-adjusted, out-of-sample, with costs.
EMA 50/200 Cross
On the daily chart, this is the strongest risk-adjusted edge we found for Japan (EWJ) over ~30.2 years — beating buy-and-hold by 0.8% CAGR.
The winner on each chart
Every indicator, ranked
Ranked by Sharpe (risk-adjusted return). Hypothetical, fees included.
| # | Indicator | TF | CAGR | Sharpe | Max DD | Win | Trades | vs B&H |
|---|---|---|---|---|---|---|---|---|
| 1 | EMA 50/200 Cross ✓ | Daily | 3.7% | 0.33 | -31.5% | 40.0% | 20 | 0.8% |
| 2 | SMA 50/200 Cross ✓ | Daily | 3.8% | 0.33 | -32.0% | 54.5% | 22 | 0.9% |
| 3 | Bollinger Mean-Reversion ✓ | Weekly | 3.0% | 0.31 | -29.8% | 73.1% | 26 | 0.2% |
| 4 | EMA 20/50 Cross ✓ | Weekly | 4.3% | 0.37 | -33.3% | 54.5% | 11 | 1.5% |
| 5 | Bollinger Mean-Reversion ✓ | Daily | 2.4% | 0.24 | -43.4% | 66.9% | 130 | -0.4% |
| 6 | Stochastic ✓ | Daily | 2.2% | 0.22 | -43.1% | 65.0% | 157 | -0.7% |
| 7 | Holy Grail Confluence ✓ | Daily | 1.9% | 0.2 | -40.2% | 63.6% | 44 | -1.0% |
| 8 | Rate of Change ✓ | Weekly | 1.6% | 0.19 | -44.3% | 47.0% | 100 | -1.2% |
| 9 | Bollinger Breakout ✓ | Weekly | 1.3% | 0.18 | -31.2% | 52.0% | 25 | -1.5% |
| 10 | MACD ✓ | Weekly | 1.4% | 0.17 | -38.2% | 47.5% | 59 | -1.4% |
| 11 | Donchian Breakout ✓ | Weekly | 1.4% | 0.17 | -40.2% | 56.5% | 23 | -1.4% |
| 12 | RSI Mean-Reversion ✓ | Daily | 1.2% | 0.16 | -31.0% | 61.5% | 39 | -1.7% |
| 13 | Money Flow Index ✓ | Daily | 1.3% | 0.16 | -48.9% | 65.2% | 23 | -1.6% |
| 14 | RSI Trend (>50) ✓ | Weekly | 1.1% | 0.15 | -46.1% | 31.4% | 86 | -1.7% |
✓ = held up out-of-sample. Hypothetical, costs included. See methodology.
For Japan (EWJ), EMA 50/200 Cross on the daily timeframe gave the best balance of return and risk in our test. It beat buy-and-hold — but remember: this is a hypothetical backtest of a standard rule, not a recommendation. Markets change. See the methodology and disclaimer.
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