Ehler Fisher Transform Analysis and Ehler Fisher Transform Signals

Developed and Created by John Ehler,

Originally used to trade Stocks & Commodities Market.

Ehler Fisher Transform has 2 lines, the Fisher Transform line and the signal line: signals are derived & generated when there is a cross over of these 2 lines which looks like the stochastic oscillator.

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

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

Ehler Fisher Transform

Gold Technical Analysis and Generating Signals

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

However, this Ehler Fisher Transform isn't very accurate, as with all leading indicators, it gives many false signals & it's prone to whipsaws, it is hence recommended to trade it in combination together with other indicators.

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