Zak Mir takes a charting look at some of the most closely followed small caps on the London Stock Exchange. Today’s charts are FTSE 100, DAX, Dow, Bitcoin, Ethereum, Gold, Arc, Cloudbreak, DSW, Eurasia, Ferrexpo, First Class, Hydrogen Utopia, SThree, Sovereign Metals, Sulnox, Tavistock, and Wishbone.
The theme is simple: several markets are testing key resistance levels while a handful of smaller stocks are attempting meaningful recoveries after extended selloffs. Momentum indicators and moving averages are doing the heavy lifting for trade ideas this week.
As always, do your own research and treat these as chart-based observations rather than hard recommendations.
Major indices: FTSE 100, DAX and the Dow
FTSE 100
The FTSE has hit a clear resistance wall around 97.70 while still sitting above the 50‑day moving average at 96.34. Price action is trading inside a rising channel whose top sits near 10,000. The technical bias remains bullish as long as the index holds above the 50‑day line.
Key levels to watch:
- Immediate resistance: 97.7
- Support / channel floor: 95.5
- Important moving average: 50‑day at 96.34
Seasonal flows and year‑end window dressing increase the odds of staying above the 50‑day in the near term, but a decisive break below the channel floor would flip the picture.
DAX
The DAX is resting on an old broken October resistance around 24,100. Above that level the market may aim for the top of its range and challenge the record high near 24,600+. A more ambitious stretch target by the end of next month would be 26,000, although that would be an impressive move given the market has been largely flat since May.
Downside guardposts include the 50‑day and the 200‑day at 23,500 if selling pressure intensifies below 24,000.
Dow Jones
After a strong week the Dow stalled short of 49,000 and the top of a February rising trend channel. Support is concentrated around the old October resistance at 48,000, with intraday support near the 50‑day around 47,100. Expect the 48,000 area to act as a first line of support unless we see a sharp reversal.
Crypto: Bitcoin and Ethereum
Bitcoin
Bitcoin gave a clear warning when the RSI produced a double fade off the 50 line. That momentum loss pushed price from the mid‑90k area down toward the current zone around 87,000. The rising October trend channel floor sits near 81,000, with the larger support band for 2025 around 75–80,000.
For a meaningful recovery BTC needs to clear the October resistance near 91,000. A confirmed break above that would open a move toward the 50‑day and a target near 95,000. Until that occurs downside risk remains real.
Ethereum
Ethereum disappointed the bulls by slipping below 3,000. The key uptrend from April is approaching at about 2,800 — this trend line is effectively the line in the sand to prevent a deeper bear phase. The 50‑day sits nearer 3,221, while a break below the April uptrend exposes last month’s support at 2,622.
With the RSI around 42 the bias is skewed to the downside unless momentum improves.
Gold
Gold pulled back after a solid start to the week. Immediate resistance and a short‑term pivot sits around 42.70. Holding an end‑of‑day close above that would keep the path open for a move toward approximately 4,600 by the end of next month. Failure to hold would likely bring the 50‑day area into play near 41.20.
Selected Small‑Caps
Technical momentum and RSI signals are driving a number of speculative setups. Below are concise notes, targets and risk points for names that have recently displayed actionable patterns.
- ARC Minerals — The stock is bouncing from an extremely oversold state not seen since 2010. A December double bottom around 0.38p is in place; initial target is previous November resistance at 0.50p, with the 50‑day near 0.56p as a best‑case target while momentum holds.
- Cloudbreak — After a larger pullback the share found a bear‑trap bounce above early December support at 0.62p. Look for a retest of the 50‑day near 0.88p by month end if strength continues.
- DSW Capital — Bull‑flag breakout clearing old resistance at 60p. The top of the channel projects up to roughly 81p by month end on the current trajectory.
- Eurasia — Market sentiment has lifted, likely on positive speculation around a geopolitical development. The shares have logged a double RSI 50 rebound and pushed above the 50‑day around 4.5p. Minimum upside near 5.8p, with best case around 7.4p into next month if momentum sustains.
- Ferrexpo — The old target zone near 66p has turned into support. Staying above the low 70s would be constructive; the upper parallel of the rising channel projects to about 92p by month end. Long‑term upside would depend heavily on broader macro and geopolitical developments.
- First Class Metals — Follow‑through after a gap higher. Both the 15‑ and 200‑day averages are rising; target projection hits the October resistance projection near 4.5p while remaining above the 50‑day at about 2.3p.
- Hydrogen Utopia — A gap up created a classic bear‑trap reversal. The failed gap fill is a bullish sign and the stock has produced multiple RSI 50 rebounds since October. A retest of the June / 2025 resistance around 4.2p could come as soon as month end.
- SThree — Cleared recent resistance at about £1.72. Initial target near £2.08, with a best case around £2.24 by the end of next month if momentum holds. Much of the bad news appears priced in, limiting downside shocks.
- Sovereign Metals — Strong relative strength today and bullish RSI divergence. Minimum target is the gap zone near 30p, with upside to 37p and a March resistance line as a further target if the trend continues. Keep November support at 25p as the stop‑loss region.
- SulNOx Group — A clear rising trend channel with multiple RSI 50 rebounds. The near target was 80p, and the call is ambitious: £1.50 by the end of next month if a catalyst appears.
- Tavistock — Shares reacted to a legal win with a gap up and a bear‑trap reversal. The 200‑day moving average near 4.45p is the minimum upside; best case scenario around 6.5p by the end of next month.
- Wishbone Gold — Up strongly after remaining above the August gap floor at 39p. The 200‑day sits around 61–62p as the minimum target, with an optimistic end‑of‑next‑month target near 92p. A solid end‑of‑day close above the 200‑day would be a bullish confirmation.
How momentum and moving averages are shaping trades
Two recurring technical themes underpin these notes:
- RSI 50 rebounds (and failures) — Crosses around the 50 level in the RSI often act as early momentum confirmations. Multiple rebounds suggest persistent buying pressure; double fades or failed rebounds warn of weakening momentum.
- 50‑day and 200‑day moving averages — The 50‑day is serving as the most immediate support or resistance for many instruments. The 200‑day remains the structural dividing line between bull and bear regimes on the larger timeframe.
Quick risk checklist before acting
- Confirm end‑of‑day closes above (or below) key moving averages rather than intraday probes.
- Use recent support levels as stop loss anchors: monthly lows, gap floors and the 200‑day where applicable.
- Factor in seasonality and year‑end flows—these can exaggerate short‑term moves.
- Match position size to the volatility of small caps; technical breakouts can produce sharp both‑ways moves.
Markets are positioned at important technical inflection points. The coming sessions will clarify whether current momentum can convert into a sustained advance or whether we should expect a deeper retracement into key moving averages and trend‑line support.
Disclaimer & Declaration of Interest:
The information, investment views, and recommendations in this Zaks Traders Cafe interview are provided for general information purposes only. Nothing in this interview should be construed as a promotion or solicitation to buy or sell any financial product relating to any companies under discussion or referred to or to engage in or refrain from doing so or engage in any other transaction. Any opinions or comments are made to the best of the knowledge and belief of the commentator but no responsibility is accepted for actions based on such opinions or comments. The commentators may or may not hold investments in the companies under discussion.
