Technical Analysis: LFEX Norway Exporters Salmon Index, 12th April 2024

David Nye - The London Fish Exchange

Published: 15th April 2024

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

  

The Oslo FoB Index fell 7.22% during this week of trading. The 142.75 NOK horizontal resistance zone and the pink upward sloping trendline repelled the Oslo FoB Index back down to lower prices.

The Oslo FoB Index finally broke below the steep green upward sloping trendline. You can see when this trendline broke was at the high prices for the Oslo FoB Index. You can see on the chart the horizontal support zones for possible target prices below the current price. The 124 NOK to 126 NOK price area is an interesting price area for support. There are two independent techniques showing a confluence of horizontal support in this price area. There is also the red and green dotted trendlines that should also offer support when tested.

The Composite Index has made a large retreat from its historically high displacement from the last few weeks. It is now at a displacement that has shown some trend changes. The mostly recent test of this displacement happened on February 15th and March 6th of this year where this displacement was used as support and resistance. There are some horizontal displacements with more history slightly below the current displacement levels. I do not see any bullish divergence in the Composite Index currently.

The RSI has also made a substantial pullback in its displacement this week. The RSI does have some current history of making changes at its current displacement. Like the Composite Index, there is more history at slightly lower displacement levels. The RSI did use this displacement as support on February 15th, 2024 and as resistance on July 7th, 2023. Meaning, it’s certainly possible to use it again as support or resistance. I do not see any bullish divergence in the RSI currently.

The Oslo FoB Index appears to be heading down to one of the horizontal support zones shown on the chart. Which one? The most likely support zone is the 124 NOK to 126 NOK support zone; however, nothing is 100%.

As usual, there are bullish and bearish developments in this week’s update. The bullish view is the Composite Index and the RSI have made large pullbacks in their displacements relative to the price move in the Oslo FoB Index. If you look Composite Index during the 2023 highs, I could argue that this year’s Composite Index characteristics look similar. There can easily be another swing to higher prices while the Composite Index makes a lower displacement high, giving a clearer bearish divergence signal similar to what we saw in 2023. The bearish view is the Oslo FoB Index tested the pink trendline connecting the prior years high trades and was rejected. The Oslo FoB Index appears to put in its price highs during this time of the year. I can easily count a 5 wave swing up from the rally from mid-March to April 5th, 2024. The Oslo FoB Index price is not on support, and I don’t see any bullish divergence in the indicators.

In summary, I’d wait to see where the Oslo FoB Index finds support and look at what the indicators are saying. It’s certainly possible that the price highs are in but at the same time, it would not surprise me to see the market find support and attempt another rally.

  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