What it does
The Fisher Transform, by John Ehlers, converts price into a shape that approximates a normal distribution so that extremes stand out sharply. It first normalizes the midpoint price of the last N bars (default 9 or 10) into the range -1 to +1, then applies the mathematical Fisher transform, 0.5 times the natural log of (1+x)/(1-x). The output swings around zero with unusually crisp, pointed turning points, and is usually plotted with a 1-bar-lagged copy of itself as a trigger line.
How to add it
Click Indicators (ƒx) in the header.
Search “Fisher Transform” and click the result.
Hover its legend row and click the gear to open settings.
How traders use it
- Trade the trigger cross: the Fisher line crossing its lagged signal line after reaching an extreme is the standard entry cue.
- Treat readings beyond roughly +1.5/-1.5 (and especially +2.5/-2.5) as stretched territory where reversals become likely.
- Use its sharp peaks to time entries flagged by slower tools, since Fisher turns tend to be earlier and better defined than RSI or Stochastic turns.
- Take only signals aligned with the higher-timeframe trend to avoid catching knives.
Inputs
| Input | Type | Default | Range / Options |
|---|---|---|---|
| Period | number | 9 | 2–200 |
Plots & styling
| Plot | Style | Default color |
|---|---|---|
| Fisher | line | #2196F3 |
| Trigger | line | #FF6D00 |
Every plot's color, line width and visibility can be changed on the Style tab. Precision (default 2 decimals), price-scale labels and status-line values are configurable at the bottom of the Style tab.
Reference levels
| Level | Value |
|---|---|
| 1.5 | 1.5 |
| 0.75 | 0.75 |
| 0 | 0 |
| -0.75 | -0.75 |
| -1.5 | -1.5 |
Level values, colors and line styles are editable in settings.
Tips
- The pane keeps its height in saved layouts, so size it once and it survives reloads.
- Resize the pane by dragging its divider; collapse it from the legend row when you need the space back.
- Use Add to favorites in the legend menu; starred studies surface at the top of the picker.
Watch out for
- Its speed produces frequent false crosses in choppy markets, and extremes can extend much further in strong trends.
- The normalization window means fresh volatility regimes briefly distort what counts as an extreme.