The best indicator for Financials (XLF)
We backtested 382 indicators across daily, weekly and hourly charts on real Financials (XLF) history. Here's what actually worked — risk-adjusted over the full backtest, with costs, and checked out-of-sample.
Where Financials (XLF) 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.
Connors RSI-2
On the daily chart, this is the strongest risk-adjusted edge we found for Financials (XLF) over ~27.7 years — beating buy-and-hold by 1.5% CAGR.
Financials (XLF) on the daily 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 Financials (XLF) — trailing buy-and-hold by 3.3% 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 | Connors RSI-2 ✓ | Daily | 7.4% | 0.49 | -43.4% | 68.0% | 331 | 1.5% |
| 2 | WMA 200 Trend ✓ | Weekly | 5.3% | 0.46 | -36.7% | 55.6% | 18 | -0.4% |
| 3 | ALMA 100 Trend ✓ | Weekly | 5.0% | 0.46 | -23.7% | 44.4% | 36 | -0.8% |
| 4 | WMA 10/40 Cross ✓ | Weekly | 5.7% | 0.46 | -34.6% | 54.2% | 24 | -0.0% |
| 5 | Connors RSI | Daily | 7.0% | 0.45 | -46.5% | 69.1% | 327 | 1.1% |
| 6 | TRIMA 200 Trend ✓ | Daily | 5.0% | 0.45 | -37.9% | 43.3% | 60 | -0.8% |
| 7 | Hull Suite ✓ | Weekly | 5.7% | 0.45 | -33.1% | 51.7% | 29 | -0.0% |
| 8 | T3 200 Trend ✓ | Daily | 4.5% | 0.44 | -31.7% | 46.7% | 60 | -1.4% |
| 9 | DEMA 20/50 Cross ✓ | Weekly | 5.1% | 0.44 | -30.3% | 47.6% | 21 | -0.6% |
| 10 | EMA 200 Trend ✓ | Weekly | 5.2% | 0.44 | -38.4% | 66.7% | 15 | -0.5% |
| 11 | Awesome Oscillator ✓ | Weekly | 5.2% | 0.43 | -37.3% | 43.3% | 30 | -0.5% |
| 12 | TRIMA 30 Trend ✓ | Weekly | 4.8% | 0.43 | -25.1% | 48.8% | 41 | -1.0% |
| 13 | EMA 8/21 Cross ✓ | Weekly | 5.1% | 0.42 | -29.8% | 41.4% | 29 | -0.6% |
| 14 | Hull MA 200 Trend ✓ | Weekly | 4.0% | 0.42 | -24.6% | 43.8% | 32 | -1.7% |
✓ = held up out-of-sample. Hypothetical, costs included. See methodology.
What it would take to beat buy & hold on Financials (XLF)
3 of 665 tested setups beat buy-and-hold on Financials (XLF) outright. Another 311 could get there with leverage they would survive — but 239 would be liquidated by their own drawdown before they caught it.
| Indicator | Beats B&H unlevered | Leverage needed | Leverage survived |
|---|---|---|---|
| Connors RSI-2 | 1 | none needed | 2.88× |
| DeMarker | 1 | none needed | 4.61× |
| Connors RSI | 1 | none needed | 2.8× |
| Zero-Lag EMA Cross | — | 1.2× | 5.17× |
| ZLEMA 10/30 Cross | — | 1.2× | 5.17× |
| Zero-Lag LSMA | — | 1.27× | 3.84× |
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 Financials (XLF), Connors RSI-2 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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