The best indicator for S&P 500 (SPY)
We backtested 382 indicators across daily, weekly and hourly charts on real S&P 500 (SPY) history. Here's what actually worked — risk-adjusted over the full backtest, with costs, and checked out-of-sample.
Where S&P 500 (SPY) stands
Computed from our own daily OHLCV history, not quoted from a third party. Moving averages use closing prices; "52-week" is the last 252 trading sessions.
McGinley 100 Trend
On the 4-hour chart, this is the strongest risk-adjusted edge we found for S&P 500 (SPY) over ~3.9 years — trailing buy-and-hold by 1.9% CAGR.
S&P 500 (SPY) on the 4-hour chart
The timeframe our backtest found best for this asset. The chart is live market data; the results above are hypothetical and historical.
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Best multi-indicator combo
Going long only when all 2 agree was the strongest confluence setup we found for S&P 500 (SPY) — trailing buy-and-hold by 3.2% CAGR, out-of-sample. Fewer, higher-conviction trades than any single indicator.
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 | McGinley 100 Trend ✓ | 4-Hour | 14.8% | 1.46 | -9.9% | 57.1% | 14 | -1.9% |
| 2 | Ehlers TrendFlex ✓ | 4-Hour | 9.8% | 1.22 | -7.9% | 44.7% | 38 | -6.9% |
| 3 | KAMA 200 Trend ✓ | 4-Hour | 10.5% | 1.2 | -9.3% | 38.9% | 36 | -6.2% |
| 4 | G-Channel ✓ | 4-Hour | 11.4% | 1.18 | -11.0% | 44.1% | 34 | -5.2% |
| 5 | McGinley 30 Trend | 4-Hour | 10.0% | 1.18 | -9.8% | 44.9% | 49 | -6.7% |
| 6 | KAMA 100 Trend ✓ | 4-Hour | 9.7% | 1.17 | -7.5% | 37.2% | 43 | -7.0% |
| 7 | Momentum (50) | 4-Hour | 9.2% | 1.14 | -9.4% | 44.7% | 38 | -7.4% |
| 8 | EMA 20/50 Cross | 4-Hour | 9.4% | 1.1 | -7.3% | 40.0% | 15 | -7.3% |
| 9 | VIDYA 30 Trend ✓ | 4-Hour | 10.1% | 1.1 | -8.3% | 34.8% | 23 | -6.5% |
| 10 | SMC: Fair Value Gap ✓ | 4-Hour | 8.4% | 1.09 | -9.2% | 42.0% | 100 | -8.3% |
| 11 | Smoothed MA (Wilder) ✓ | 4-Hour | 8.7% | 1.07 | -7.5% | 41.2% | 68 | -8.0% |
| 12 | Ehlers Stochastic ✓ | 4-Hour | 8.5% | 1.06 | -8.7% | 52.3% | 44 | -8.2% |
| 13 | Awesome Oscillator ✓ | 4-Hour | 8.0% | 1.05 | -8.6% | 48.5% | 33 | -8.7% |
| 14 | SMA 20/50 Cross ✓ | 4-Hour | 8.5% | 1.04 | -7.1% | 44.4% | 18 | -8.2% |
✓ = held up out-of-sample. Hypothetical, costs included. See methodology.
What it would take to beat buy & hold on S&P 500 (SPY)
1 of 1338 tested setups beat buy-and-hold on S&P 500 (SPY) outright. Another 828 could get there with leverage they would survive — but 157 would be liquidated by their own drawdown before they caught it.
| Indicator | Beats B&H unlevered | Leverage needed | Leverage survived |
|---|---|---|---|
| Markov Regime | 1 | none needed | 2.97× |
| Sine-Weighted MA | — | 1.85× | 6.86× |
| Predictive Ranges | — | 1.83× | 6.89× |
| Volatility Stop (ATR) | — | 1.97× | 8.72× |
| RSI (21) | — | 2.06× | 6.43× |
| Supertrend Fast (10,2) | — | 2.19× | 8.11× |
Out-of-sample, costs included. A setup is only listed if the leverage it needs is less than the leverage its own worst drawdown survives — when it isn't, no amount of leverage gets there. Volatility drag isn't modelled, so these are the optimistic case. Every indicator, ranked this way
For S&P 500 (SPY), McGinley 100 Trend on the 4-hour 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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