Technical Analysis: LFEX Norway Exporters Salmon Index, 27th October 2023

David Nye - The London Fish Exchange

Published: 30th October 2023

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

  

It’s been two weeks since my last update. The Oslo FoB Index has fallen 12.72% during this time. The decline in the Oslo FoB Index should not have been a big surprise with the bearish divergence in the Composite Index from the prior update.

The Oslo FoB Index is now on top of a price moving average which has provided support for the last three trading days. The Oslo FoB Index has made a lower low, breaking the string of higher highs and higher lows. I don’t believe this is a major concern at this time. There is additional price support for the Oslo FoB Index at 74.03 NOK and 69.65 NOK. I drew in a steep red declining trendline connecting the most recent price highs in the Oslo FoB Index. Watch for a break above this trendline for a possible change or weakening of the current downtrend in prices. Notice the 81.16 NOK resistance zone also has several price moving averages near the same price. This will make the 81.16 NOK resistance zone more challenging to overcome.

The Composite Index has moved down to the lower end of its historical displacement history. The Composite can continue to move lower. The Composite Index does have history of making lows at its current displacement. The character of the turns has been both in the shape of a V and M, single or double bottoms. Notice the two blue trendlines drawn on the Composite Index. These two trendlines cross each other very near the red fast-moving average on the Composite Index. These are trendlines that had shown divergence in the past. When two trendlines showing divergence cross each other there is usually a change or acceleration in trend. Just above this same intersection, there are two other trendlines crossing each other that show the same signal.

The RSI has also moved down from the higher end of its historical displacement to the lower end of its displacement history. There is a green trendline marking previous bullish divergence in the RSI that can also offer support for the RSI near its current displacement. When the Oslo FoB Index is trending higher, the RSI holds the 35 to 40 displacement area. If we are seeing the start of a new trend of higher prices in the Oslo FoB Index, it’s important for the RSI to hold the 35-displacement area. The RSI also has history of making turns at its current displacement. These turns appear to be more in the shape of V turns, single bottom lows.

Is the Oslo FoB Index moving higher or lower in the next few weeks? Watch for a break above the steep down sloping red trendline drawn on the Oslo FoB Index prices or a break below the current price moving average. I can argue that there is bullish divergence between the Composite Index and the RSI. However, this signal has lost some of its strength because of the length of time between the two anchor points. I marked this divergence with black trendline on the Composite Index and RSI. There are also some clues that the Oslo FoB Index should see a change or acceleration in trend in the next week or two.

I included a second chart of the Oslo FoB Index with a sharper view of the nearby history for your review.

  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