Everyone is looking for an edge when trading crypto. In a new video, a Bitcoin indicator designed for finding precise market turning points is used to turn $5 into $34,000.
The results are a shocking 88% success rate and more than 679,000% ROI. Let’s take a closer look.
The Fisher TransformFisher Transform was created by John Elhers and first mentioned in the November 2002 Issue of Technical Analysis of Stocks and Commodities Magazine. The tool attempts to make sense of unpredictable price movements by using statistics.
The indicator takes price data and transforms it into a Gaussian normal distribution. All this means is that the tool tries to make the price data look like a more organized pattern that can be easier to understand.
In addition to using the tool’s turning points for buy and sell signals, passing through the zero line is also a sign that a trend is strengthening. While the tool is highly effective, combining its signals with Japanese candlesticks, chart patterns, and Elliott Wave Principle can improve results.
In the video, the monthly Fisher Transform is used to generate buy and sell signals when the trigger line crosses above the fisher line from below or above, respectively.
The tool makes several bad trades. It notably loses some money it has earned on the way up at the second Bitcoin top in 2021. Despite a couple slip ups, the Fisher Transform turns $5 into $34,000 in the end. Over $30,000 is added during the best trade.
This translates to roughly a 679,000% ROI over the lifetime of BTCUSD price history. The shocking return is a reminder for investors and traders to find a technical system that works and then let it do its thing. Objective, non-discretionary trading systems may be boring but take emotions and bias out of the equation.
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