Using Signal Lines in the Detrended Synthetic Price Indicator

Summary

This short note discusses the Detrended Synthetic Price indicator, attributed to John Ehlers, and compares two ways to present its signals. It argues that applying fixed threshold levels to the basic oscillator can be cumbersome because the levels may need adjustment for each symbol, timeframe, or parameter configuration. The suggested alternative is a version based on signal lines, displayed as colored bars on the main price chart.

The document presents this alternative as a potentially more practical indicator display, but it does not specify the calculation rules, bar-coloring conditions, signal interpretation, or a trading system for acting on the signals. It provides no chart evidence, market tests, or performance results in the supplied text. Readers therefore get a limited implementation idea rather than evidence that the indicator predicts returns or improves trades; the appropriate settings and usefulness would need to be assessed for each application.

Key ideas

• The Detrended Synthetic Price indicator is attributed to John Ehlers.
• Fixed oscillator thresholds may require adjustment across symbols, timeframes, and parameter settings.
• A signal-line version can display oscillator information as colored bars on the price chart.
• The note does not provide signal rules or evidence of trading performance.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.