Technical Analysis: LFEX Norway Exporters Salmon Index, 28th June 2024

David Nye - The London Fish Exchange

Published: 1st July 2024

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

  

The Oslo FoB Index rallied 0.72% during this week of trading. The Oslo FoB Index is now testing the underside of the 76.75 NOK horizontal resistance zone.

The purple trendline that connects the past several years low prices is just above the Oslo FoB Index current price. The purple trendline should offer additional resistance. I can clearly see 5 swings in price down from the price highs from April of 2024. This suggests that the Oslo FoB Index is ready to change direction and rally. Elliott Wave Theory suggests that human sentiment moves in waves of 3 and 5. Price swings and Elliott Waves are not the same thing so predicting where the Oslo FoB Index is in the Elliott Wave count isn’t as easy as it would first appear. If the current swing down in prices is over, “usually” the security will retrace 1/3, 1/2, or 2/3 of the previous swing. I put a green (B) on the chart to show a logical retracement target if this swing down in prices is over. There is no time expectation for this possible target.

The Composite Index did test and bounce while testing the positive crossover of it’s moving averages. Notice the bullish divergence in the Composite Index is continuing vs the Oslo FoB Index price. The Composite Index made a recent higher displacement high vs the Oslo FoB Index that made a lower price low. The concerning issue I have with the rally in the Composite Index is it has made a large move higher in its displacement vs the corresponding move up in the Oslo FoB Index. The Composite Index is becoming more overbought at lower Oslo FoB Index prices.

The RSI also made a higher recent low vs the Oslo FoB Index on Tuesday June 25th. The RSI doesn’t diverge with the Oslo FoB Index very often and it’s generally not a great tool to forecast price turns but when the RSI does diverge, it’s wise to pay attention. However, we move forward to today and now the RSI is making a higher high vs the Composite Index and the Oslo FoB Index, this is a form a bearish divergence. It’s not surprising to have mixed signals after such a large drop in the Oslo FoB Index price. The market participants appear to be searching for a bottom in prices. The RSI doesn’t have a lot of history at this displacement, but this displacement was used as support in May and September of 2021 so it’s possible the RSI will could use this displacement as resistance.

In summary, the Oslo FoB Index might be attempting to retrace part of decline from April 2024. The Oslo FoB Index is still making lower price lows and lower price highs, so the downtrend continues. Looking at previous year’s downtrends, the rallies appear to form steep retracements that consist of 3 wave swings. If a rally is coming in the Oslo FoB Index, I’d expect to see a rally develop with a similar formation as we’ve seen in prior years.

  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