The best indicator for Russell 2000 (IWM)
We backtested 20 indicators across daily, weekly and hourly charts on real Russell 2000 (IWM) history. Here's what actually worked — risk-adjusted, out-of-sample, with costs.
CCI
On the weekly chart, this is the strongest risk-adjusted edge we found for Russell 2000 (IWM) over ~26.1 years — trailing buy-and-hold by 1.6% 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 | CCI ✓ | Weekly | 7.0% | 0.6 | -29.9% | 89.7% | 29 | -1.6% |
| 2 | Stochastic ✓ | Weekly | 6.1% | 0.48 | -34.0% | 82.1% | 28 | -2.5% |
| 3 | Money Flow Index ✓ | 1-Hour | 11.8% | 0.79 | -24.2% | 76.0% | 25 | -2.9% |
| 4 | Donchian Midline ✓ | Weekly | 5.6% | 0.45 | -35.4% | 47.8% | 69 | -3.0% |
| 5 | Williams %R ✓ | Weekly | 5.4% | 0.44 | -34.1% | 80.0% | 35 | -3.2% |
| 6 | WaveTrend (8/6/4) ✓ | Weekly | 5.3% | 0.43 | -38.7% | 81.8% | 22 | -3.3% |
| 7 | RSI Trend (>50) ✓ | Weekly | 4.6% | 0.38 | -27.8% | 49.3% | 75 | -4.0% |
| 8 | EMA 20/50 Cross ✓ | Daily | 4.5% | 0.37 | -36.5% | 41.7% | 60 | -4.1% |
| 9 | SMA 50/200 Cross ✓ | 1-Hour | 12.5% | 0.85 | -18.7% | 54.5% | 11 | -2.3% |
| 10 | Bollinger Mean-Reversion ✓ | 1-Hour | 6.7% | 0.62 | -13.7% | 67.0% | 94 | -8.1% |
| 11 | Holy Grail Confluence ✓ | Daily | 4.1% | 0.35 | -42.0% | 82.1% | 39 | -4.5% |
| 12 | CCI ✓ | 1-Hour | 8.0% | 0.6 | -18.7% | 66.7% | 96 | -6.8% |
| 13 | EMA 50/200 Cross | Daily | 4.2% | 0.34 | -46.8% | 50.0% | 18 | -4.4% |
| 14 | EMA-10 Trend ✓ | Weekly | 4.0% | 0.34 | -31.9% | 55.7% | 122 | -4.6% |
✓ = held up out-of-sample. Hypothetical, costs included. See methodology.
For Russell 2000 (IWM), CCI on the weekly 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.
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