Zak Mir takes a charting look at some of the most closely followed small caps on the London Stock Exchange. Today’s charts are the FTSE 100, DAX, Dow, Bitcoin, Ethereum, Gold, WTI Crude Oil, SpaceX, Andrada, Bay Capital, Bezant, Georgina, Harena, Orosur, Phoenix Copper, Savills, Touchstone, Velocity Composite.
It is a mixed Friday across the charts. The FTSE 100 has done its familiar trick of pretending it has found support, then breaking it, while the DAX and Dow remain in much better technical shape. Crypto is looking remarkably lifeless, gold is trying to revive, and there are several rather more interesting small-cap recovery and breakout situations to keep an eye on.
As always, do your own research and treat these as chart-based observations rather than hard recommendations
FTSE 100: a pivotal test around 10,720
The FTSE 100 has broken the apparent support area around 10,820 more decisively than expected. The next major line in the sand is 10,760. While the index remains below that level, there is a risk of a further retreat towards the floor of the March rising channel and the 50-day moving average, around 10,609.
The RSI remains above the neutral 50 level, although its own uptrend line has broken. That makes the current session pivotal. If the intraday low around 10,720 to 10,723 holds, this still looks like a dip worth buying into. If not, the market may need one more move down before finding a firmer base.
DAX: still comfortably ahead of the FTSE
The DAX is still trading around the upper boundary of its March rising trend channel, currently near 26,500. A sustained move above that line would suggest a fresh upside leg towards 27,300, potentially by the end of next month.
The more important point is relative strength. The DAX remains well above both the floor of its channel and its 50-day moving average, unlike the FTSE. The market ideally stays above 26,000. The harsher fallback would be a move to late-July resistance near 25,500.
Dow: stay above 53,600 and 56,000 comes into view
The Dow has been trying to remain above the top of a gap at 53,600. That is the key level. Above it, the top of the April rising channel sits near 54,300, while a longer-term March trend line points towards 56,000, perhaps by the end of September.
Holding the top of the channel would be a very strong sign and would put that 56,000 target properly in the frame. Failure to hold the gap, however, would open the way towards the 50-day moving average near 52,300, or broken resistance from last month at just above 52,700.
Crypto: Bitcoin deteriorates while Ethereum goes nowhere
Bitcoin: 63,400 lost, 67,000 needed back
Bitcoin is looking disappointing. It has slipped below its rising 50-day moving average at $63,400, and the RSI uptrend line has also been lost. Early-July support at $61,400 is the immediate area to watch.
If that support fails, the main downside projection is towards $54,000, where a support line from March comes into play. The longer Bitcoin remains below June and July resistance at $67,000, the greater the chance of a more full-blooded decline. The current setup has an uncomfortable resemblance to the position seen in early May, before the previous sharp move lower.
Ethereum: a dead-market range for now
Ethereum has a slightly less troublesome chart than Bitcoin, but there is still very little going on. The rising 50-day moving average is around $1,823, while the 200-day moving average is near $2,024. That is the range to expect for now.
The RSI has drifted just below neutral 50, which is not ideal, but the market is not giving much of a directional steer either way. Until one of those moving averages breaks meaningfully, Ethereum remains a waiting game.
Gold and WTI crude: recovery attempts with clear boundaries
Gold: 4,320 is the support that matters
Gold produced a burst of excitement earlier in the week, only to fail below its 200-day moving average. It is now trying to get back in business. Recent support sits around 4,320, with the day’s low near 4,311.
As long as the market can remain above that area on an end-of-day closing basis, the upside case remains for a move back to 4,500 and the 200-day moving average, potentially by month-end.
WTI crude: the RSI favours 87 over 78
Crude oil has been stagnating while the market waits for developments around Iran. The broad near-term range is defined by the 50-day moving average around $76 to $78 and the top of the gap at $87.
The positive here is that the RSI has bounced at neutral 50. That gives a modest steer towards the upper end of the range, namely $87, rather than another slide towards $78.
SpaceX: 144 is the pivotal moving-average level
SpaceX is rather more interesting than the crypto market at present. The shares dipped back below the 50-day moving average around 144 during the previous session. An end-of-day close back above that level would set up another attempt at 150, with the 200-day moving average around 156.79 as the next objective.
Ideally, the price gets at least an hourly close above 144 and starts working its way through the 150s. Support at 130 looks solid and is not expected to be challenged anytime soon, touch wood.
Small-cap shares: the more exciting charts
- Andrada: a strong setup above 4.4p: Andrada has been through this sort of hopeful-looking moment many times, but this may finally be the one. The chart has a rising channel from earlier in the year, and the top of that channel currently points to around 5.25p by the end of next month. The bullish case stays intact while the price remains above July resistance near 4.4p. Both the 50-day and 200-day moving averages are rising in parallel, and last month’s upside gap has held. That is a very strong technical combination, offering reasonable risk-reward for those in the mood.
- Bay Capital: through 12.5p and aiming higher: Bay Capital is here partly as a tribute to the old British Airways ticker code, but the chart has also delivered. The shares have broken the previous 12.5p target and now look capable of reaching 18p to 19p, which corresponds with 2023 resistance. The target is possible by month-end or even sooner. Technically, it is a strong position.
- Bezant: slow and steady towards 0.20p: Bezant is gradually breaking higher. Both the 50-day and 200-day moving averages are rising, and the price is contained within an upward channel. The target is 0.20p by the end of next month, provided the shares stay above the 50-day moving average around 0.13p.
- Georgina Energy: bears have gone rather quiet: Georgina Energy has risen by nearly five times so far this year, which may explain why its bears have become less vocal. The next requirement is an end-of-day close above 14.75p, the former February target line. Above that, the chart points to 21p by the end of next month. That would be a rather satisfying extra two fingers up to the bears who were so diligent before the shares started moving against them.
- Harena: a golden-cross opportunity: Harena is approaching a golden cross, which is often the strongest part of the cycle. The rising trend channel projects to 3.4p to 3.5p by the end of September. The ideal technical condition is for the shares to hold above 2.5p and the 200-day moving average. If that happens, the channel top remains the obvious target.
- Orosur: a close above 17p would improve the picture: Orosur is still below half of its January high, which is a little strange given the old glories people may still be expecting. The immediate challenge is the 50-day moving-average area around current levels. An end-of-week close above 17p would clear that hurdle and open up a potential move to 21.5p, where the 200-day moving average sits, possibly by the end of the month. There may be some stake-building in the background, but that is one for individual research rather than blind faith.
- Phoenix Copper: a bull-flag breakout for strong constitutions: Phoenix Copper has had a rough ride, but the technical picture is improving sharply. It has produced a small bull-flag breakout through 0.65p. The minimum upside objective is the bottom of the gap and the 50-day moving average at 0.73p. The best case is much more ambitious: a move towards the top of the falling trend channel from May, as high as 1.16p next month.
- Savills: a saucer-shaped turnaround above £11: Savills is not the usual type of stock in this list, but it had a decent update and the chart is attractive. The company has perhaps complained more than necessary about macro conditions given its geographical diversification. Technically, the shares have built a beautiful saucer-shaped turnaround. Old resistance is at £11. A break above that points to an autumn 2025 resistance-line projection near £13 by the end of next month. The shares have repeatedly bounced above a rising 50-day moving average and the RSI has also held above neutral 50, suggesting there may still be plenty of gas in the tank.
- Touchstone: a clean break through the 200-day average: Touchstone had a decent update and has broken through the 200-day moving average at 8.42p. The top of the range and the upper boundary of the rising trend-channel base point to 12p. That target could be reached by the end of next month, or even by the end of the current month if momentum persists.
- Velocity Composites: gap closure sets up a 21p target: Velocity Composites is not a widely followed stock, but the chart is quietly compelling. The key event is the gap closure at 15p. Above that, the top of the November triangle points to 21p by the end of next month. The chart also has an RSI uptrend line and bullish divergence, both supporting the recovery case. Recent support and the 50-day moving average around 14p need to remain intact.
The levels worth keeping on the board
- FTSE 100: 10,760 resistance and 10,720 current low, with 10,609 as deeper support.
- DAX: Hold 26,000, clear 26,500, then 27,300 becomes the upside objective.
- Dow: 53,600 is the key gap top, with 54,300 and then 56,000 above.
- Bitcoin: 61,400 support, 63,400 lost 50-day average, and 67,000 resistance.
- Gold: Stay above 4,320 to retain the 4,500 recovery argument.
- WTI crude: The practical range remains $78 to $87.
- Andrada: Above 4.4p, the channel points to 5.25p.
- Phoenix Copper: Above 65p, the first target is 73p, while 58p is the support level.
- Savills: Clear £11 and £13 is the next major chart target.
For the moment, the broad message is simple. The FTSE and Bitcoin need to prove they can hold support, while the DAX and Dow still have the stronger index charts. Crypto can remain on life support until it produces a proper breakout, and the more interesting action is currently in selected small-cap shares with clear recovery, channel-breakout or moving-average setups.
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.
