How can I transform an ellipse into a circle? I have an ellipse which has -45 degree axis.

How can I transform the ellipse into a circle? Can I use shear transformation along the x/y axis?
You can use a shear, or equivalently a rotation by 45, scale along one of the axes, rotate back (which is equivalent to the shear which you are looking for).

EDIT: On second thought, you don't need to even rotate back unless your circle is marked, since a circle is rotation invariant (if the rotation is around its center).