stelaraX - Fisher Transform

stelaraX – Fisher Transform

stelaraX – Fisher Transform is a momentum and turning-point indicator designed to convert price action into a near-Gaussian distribution. This transformation amplifies market extremes and makes potential reversal points and momentum shifts clearer and more actionable.

This indicator is part of the stelaraX ecosystem, focused on clean technical analysis and AI-supported chart evaluation
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Core logic

The Fisher Transform normalizes price relative to its recent range and then applies a logarithmic transformation to magnify extreme values. The result is a highly responsive oscillator that highlights sharp momentum transitions.

Key principles:

* price is normalized within the highest–lowest range over the lookback period
* smoothing is applied to reduce noise and stabilize the signal
* values are constrained to avoid mathematical blow-ups near the limits
* the Fisher Transform magnifies extremes, making reversals more visible
* a signal line is derived from the prior Fisher value for confirmation
* values oscillate around a zero baseline

Crossovers between the Fisher line and its signal line often highlight momentum shifts and potential turning points.

Visualization

The script plots:

* the Fisher Transform line in a separate indicator pane
* a signal line based on the previous Fisher value
* a zero reference line for directional context
* individually configurable colors for Fisher and signal lines

This clean dual-line setup provides clear visibility into momentum acceleration and deceleration phases.

Use case

This indicator is intended for:

* identifying potential reversal zones via amplified extremes
* detecting early momentum shifts using Fisher/signal crossovers
* confirming trend continuation or exhaustion
* spotting divergences between price and transformed momentum
* supporting mean-reversion and momentum-based strategies

It integrates well with trend filters, structure analysis, and AI-assisted chart evaluation.

Disclaimer

This indicator is provided for educational and technical analysis purposes only and does not constitute financial advice or trading recommendations. All trading decisions and risk management remain the responsibility of the user.