The best indicator for Nikkei 225
We backtested 20 indicators across daily, weekly and hourly charts on real Nikkei 225 history. Here's what actually worked — risk-adjusted, out-of-sample, with costs.
Bollinger Breakout
On the daily chart, this is the strongest risk-adjusted edge we found for Nikkei 225 over ~59.9 years — trailing buy-and-hold by 1.0% 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 | Bollinger Breakout ✓ | Daily | 5.8% | 0.68 | -42.4% | 51.1% | 227 | -1.0% |
| 2 | ADX / DMI ✓ | Daily | 5.9% | 0.65 | -38.2% | 43.4% | 343 | -0.9% |
| 3 | RSI Trend (>50) ✓ | Weekly | 7.3% | 0.63 | -28.7% | 46.5% | 142 | 0.6% |
| 4 | EMA-10 Trend ✓ | Weekly | 6.5% | 0.58 | -31.6% | 43.1% | 262 | -0.1% |
| 5 | Rate of Change ✓ | Weekly | 6.6% | 0.57 | -31.0% | 50.8% | 179 | -0.0% |
| 6 | Donchian Midline ✓ | Weekly | 6.6% | 0.56 | -36.5% | 47.2% | 142 | -0.0% |
| 7 | Bollinger Breakout ✓ | Weekly | 4.8% | 0.54 | -23.2% | 58.2% | 55 | -1.9% |
| 8 | ADX / DMI ✓ | Weekly | 5.0% | 0.54 | -30.6% | 49.2% | 63 | -1.6% |
| 9 | EMA 50/200 Cross ✓ | Daily | 6.3% | 0.51 | -41.8% | 45.9% | 37 | -0.5% |
| 10 | EMA 20/50 Cross ✓ | Daily | 5.9% | 0.5 | -41.8% | 38.1% | 126 | -1.0% |
| 11 | Donchian Breakout ✓ | Daily | 4.9% | 0.5 | -51.9% | 47.2% | 286 | -1.9% |
| 12 | Donchian Breakout ✓ | Weekly | 5.2% | 0.5 | -33.5% | 54.5% | 55 | -1.4% |
| 13 | SMA 50/200 Cross ✓ | Daily | 5.9% | 0.49 | -43.9% | 40.0% | 40 | -0.9% |
| 14 | EMA 20/50 Cross ✓ | Weekly | 5.3% | 0.45 | -53.7% | 50.0% | 26 | -1.4% |
✓ = held up out-of-sample. Hypothetical, costs included. See methodology.
For Nikkei 225, Bollinger Breakout on the daily timeframe gave the best balance of return and risk in our test. It still trailed buy-and-hold on raw return — but remember: this is a hypothetical backtest of a standard rule, not a recommendation. Markets change. See the methodology and disclaimer.
More index
Get the weekly edge report
The best-performing indicator per asset, what changed this week, and the honest caveats — straight to your inbox.