Ehlers Fisher Transform Commodities Technical Analysis and Ehlers Fisher Transform Trading Signals

Developed by John Ehlers,

Ehlers Fisher Transform has two lines, the Fisher Transform line & the trading signal line: trading signals are generated when there is a crossover of these 2 lines which looks like the stochastic oscillator.

It was designed to define major commodities trading price reversals using the rapid response time and sharp, distinct turning points making it a leading indicator.

This commodity indicator is based on the assumption that commodities trading prices do not have a Gaussian probability density function (bell shaped curved movement), but that by normalizing commodities trading price & applying the Fisher Transform you can create a nearly Gaussian probability density function on the lines drawn.

Ehlers Fisher Transform

Commodity Technical Analysis & How to Generate Trading Signals

Trading signals can be generated with pin-point accuracy by using the cross-over points of the Fisher Transform & its signal line.

However, this Ehlers Fisher Transform is not very accurate, as with all leading technical indicators, it gives many false trading signals & it is prone to whipsaws, it's therefore recommended to trade it in combination with other technical indicators.