The best indicator for GBP/JPY
We backtested 20 indicators across daily, weekly and hourly charts on real GBP/JPY history. Here's what actually worked — risk-adjusted, out-of-sample, with costs.
Heikin-Ashi Trend
On the daily chart, this is the strongest risk-adjusted edge we found for GBP/JPY over ~23.2 years — beating buy-and-hold by 2.7% 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 | Heikin-Ashi Trend ✓ | Daily | 3.3% | 0.44 | -50.6% | 38.4% | 1174 | 2.7% |
| 2 | ADX / DMI ✓ | Daily | 2.2% | 0.42 | -28.1% | 34.2% | 158 | 1.6% |
| 3 | SMA 50/200 Cross ✓ | Daily | 2.7% | 0.39 | -22.0% | 50.0% | 14 | 2.2% |
| 4 | WaveTrend (8/6/4) ✓ | Daily | 1.8% | 0.24 | -38.1% | 66.3% | 86 | 1.2% |
| 5 | EMA 20/50 Cross ✓ | Weekly | 2.5% | 0.37 | -25.1% | 55.6% | 9 | 1.9% |
| 6 | EMA 50/200 Cross ✓ | Daily | 1.2% | 0.2 | -26.4% | 31.6% | 19 | 0.6% |
| 7 | CCI ✓ | Weekly | 0.7% | 0.13 | -32.3% | 78.3% | 23 | 0.1% |
| 8 | Bollinger Mean-Reversion ✓ | Weekly | 0.5% | 0.11 | -40.4% | 75.0% | 20 | -0.1% |
| 9 | Donchian Breakout ✓ | Weekly | 0.5% | 0.11 | -33.8% | 33.3% | 15 | -0.1% |
| 10 | Rate of Change ✓ | Weekly | 0.5% | 0.11 | -21.0% | 40.8% | 71 | -0.1% |
| 11 | RSI Mean-Reversion ✓ | Daily | 0.4% | 0.09 | -37.6% | 70.0% | 40 | -0.2% |
| 12 | ADX / DMI ✓ | Weekly | 0.2% | 0.07 | -25.9% | 34.5% | 29 | -0.4% |
| 13 | RSI Trend (>50) ✓ | Weekly | 0.2% | 0.06 | -36.5% | 26.6% | 64 | -0.4% |
| 14 | Donchian Midline ✓ | Weekly | 0.1% | 0.06 | -27.0% | 25.8% | 62 | -0.5% |
✓ = held up out-of-sample. Hypothetical, costs included. See methodology.
For GBP/JPY, Heikin-Ashi Trend 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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