Technical Analysis: LFEX Norway Exporters Salmon Index, 12th May 2023

David Nye - The London Fish Exchange

Published: 15th May 2023

This Article was Written by: David Nye - The London Fish Exchange

  

The Oslo FoB Index rallied 3.6% in the previous week. The Oslo FoB Index fell to the 102.68 NOK horizontal support zone and bounced.

The Oslo FoB Index appears to be moving to the 115.71 NOK horizontal resistance zone in the short-term. There is a red down sloping trend line that the Oslo FoB Index has been respected in the past that intersects at the 115.71 NOK price. This red trend line has provided resistance and support for the Oslo FoB Index. This is the same red trendline that marked the head and right shoulder displayed on the chart. I pasted this same trendline to the price low in early March 2023. This red trendline also intersected the Oslo FoB Index and the 102.68 NOK price zone that provided support. There is a blue up sloping trend line that is also going through the 115.71 NOK price area that should add additional resistance along with a price moving average. Notice that the Oslo FoB Index has been making lower lows and lower highs since mid-March 2023. This is the basic definition of a down trend. There is also a possible head and shoulder top in the price chart. A breakdown from this head and shoulder top would target the 92.00 NOK price area.

The Composite Index continues to diverge the Oslo FoB Index and the RSI. This is a sign the downtrend is weakening. Usually, one divergence signal is enough to change the direction of the security but sometimes it can take several divergence signals before the price trend changes. The bearish view of this setup in the Composite Index is the Index is resetting at higher a displacement while the security goes sideways setting up for another move down. The Composite Index’s current displacement has been used as support and resistance in the past. The Composite Index has rallied above its short- and long-term moving averages. This is a bullish development along with the divergence signals.

The RSI has rallied this week and appears to be heading to its green slow-moving average. This slow-moving average should provide resistance to the RSI. The RSI did break significantly below the 40ish displacement zone increasing the probability that the Oslo FoB Index is in a bear market. If this is true, the RSI will have difficulty breaking above the 65-displacement area. This is the same displacement in the RSI that coincided with the right shoulder on the price chart and marked divergence with the Composite Index.

  About This Analysis

About David Nye

David is a Senior Vice President in investment advisory with over 30 years of experience.

Based in Minnesota, USA he has a long history in technical analysis across a range of markets. David brings his experience to provide an independent insight into potential salmon pricing based on LFEX and DataSalmon data.

What is Technical Analysis?

Technical Analysis is used to try and identify price trends in the future. Analysts believe that by using factual past information (trading activity and price changes) it is possible to identify future price movement trends and is quite prevalent in commodity and forex markets but can be applied to any product.

Technical Analysis has been developing for over a century, and there are now hundreds of patterns and signals that have been created. They are often used in conjunction with other forms of research and analysis to help formulate, or support pricing trend opinions.

Purpose of the Analysis?

To provide an independent data-driven view of market pricing trends in the short and medium-term. As a potential tool, for users to access future pricing trends based on LFEX/DataSalmon derived market data.

How Does it Work?

On a regular basis (weekly), David will provide his independent analysis of LFEX and DataSalmon pricing data. The output will be to provide pricing trends based on the most up to date pricing received.

The analysis will show the expected trends and potential (price) levels, as well as other markers – for example, higher or lower price triggers that would affect the analysis of the trend – and what this might mean. It is data-driven, and will not, and does not, account for any other fundamental analysis, or weather or biological events for example. This is the same for any commodity product technical analysis.

Disclaimer

All information provided contains no guarantee whatsoever, especially of completeness, accuracy, timeliness or of the results obtained from the use of this information, and is provided without warranty of any kind, expressly or implied. In no event will, LFEX Ltd or DataSalmon, its member firms, or the partners, directors, officers, owners, agents or employees thereof be liable to you or anyone else for any decision made or action taken in reliance on the information or for any consequential, special or similar damages, even if advised of the possibility of such damages. In no event and under no legal or equitable theory, whether in tort, contract, strict liability or otherwise, shall LFEX Ltd or DataSalmon be liable for any direct, indirect, special, incidental or consequential damages arising out of any use of the information contained herein, including, without limitation, damages for lost profits, loss of goodwill, loss of data, work stoppage, the accuracy of results, or computer failure or malfunction