Ehlers Fisher Transform Energies Technical Analysis & Ehlers Fisher Transform Trading Signals

Developed by John Ehlers,

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

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

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

Ehlers Fisher Transform

Energy Technical Analysis & How to Generate Trading Signals

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

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