Technical Analysis: LFEX Norway Exporters Salmon Index, 31st January 2025

David Nye - The London Fish Exchange

Published: 3rd February 2025

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

  


The Oslo FoB Index closed the week down 3.01% to end the week at 90.11 NOK. I made a few updates to the horizontal support and resistance zones and I moved the green upward sloping trendline and that caught the low trade from Thursday of this week.

You can see the horizontal resistance zones above the current Oslo FoB Index price. The purple upward sloping trendline could also act as resistance if tested. Looking at the last 5 months of trading, the Oslo FoB Index continues to make higher highs and higher lows. If this trend continues, the next high is a long way away from current prices. This retracement looks larger than prior years price retracements of Oslo FoB Index rally during the December holidays.

The first thing I saw when looking at the chart was the bullish divergence signal in the Composite Index. The Oslo FoB Index has made a lower price low while the Composite Index has made a higher displacement low. I drew a grey trendline on the Composite Index and the RSI to help you see the divergence. The Composite Index is also diverging with the RSI. This could easily be the buy signal for the start of the next rally in the Oslo FoB Index. The Composite Index does have some history of making a W shaped bottom formations at this displacement, but this isn’t necessary.

The RSI made a troubling displacement low this week for the bulls. This displacement low in the RSI was lower than any previous displacement low during a bull market in the available history of the Oslo FoB Index. This is a troubling development for the bulls. However, this lower low did provide a bullish divergence signal with the Composite Index. I left the red dashed horizontal line at the displacement low for you to go back and look at the history of this displacement low. The green dashed line is near the current RSI displacement. The RSI is also about to test the underside of its fast-moving average. Notice how large the spread is between the moving averages for the RSI. The spread is large and should begin to converge, meaning the RSI should move towards a higher displacement at some point in time. The same argument could be made for the Composite Index.

In summary, the Oslo FoB Index could be starting the next leg up in prices. The bullish divergence in the Composite Index is hard to ignore. I’m still a believer that the season highs are not in yet for the Oslo FoB Index. I should also say that the seasonal highs usually come in during the March to May time frames each year, within the available history of the data. The displacement low in the RSI this week is a concerning development if you are looking for higher prices. As usual, nothing is ever 100% bullish or bearish. There are always some mixed signals. The timing signal I mentioned in last weeks update turned out to be a short-term price high.

  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