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, Avacta, Amigo, Blue Star, BSF, B HODL, Bluebird, First Class, GCM, Hydrogen Utopia, Halo, Itaconix, Smarter Web, Tomco, Thor Explorations.
The glass is half full across several charts at the moment. Major indices have found support, Bitcoin and Ethereum are breaking higher, gold has a particularly strong technical setup, and several smaller shares are starting to show the sort of momentum that can catch the bears on the wrong side of the move.
As always, do your own research and treat these as chart-based observations rather than hard recommendations
That said, technical analysis is about levels, not blind optimism. A market can look constructive while still needing one final pullback before the next proper advance. Here are the key support, resistance and moving-average signals currently shaping the charts.
FTSE 100: Support Holds, but 10,820 Is Still the Problem
The FTSE 100 has bounced from the floor of its rising trend channel, in place since late March, at around 10,700. The RSI has also climbed back above the neutral 50 level, which is a welcome sign that momentum is turning less negative.
The issue is that the index remains stuck beneath the 10,800 to 10,820 area. That was previous support, now turned resistance, and the market has backed away from it. Unless it can reclaim that level, there is a reasonable chance of a final flush towards the rising 50-day moving average at roughly 10,650 before month-end.
- Immediate support: 10,700, then the 50-day moving average near 10,650.
- Near-term resistance: 10,800 to 10,820.
- More cautious bearish trigger: An end-of-day close below 10,700.
The best immediate outcome would be a recovery towards 10,820, but the more likely pattern may still be a brief retreat to the 50-day line first.
DAX: Consolidating Around the Old 26,000 Resistance
The DAX is consolidating around its former July resistance near 26,000. Holding above that region keeps the upside case alive, with the top of the channel around 26,500 remaining the next obvious objective.
If the market breaks down instead, the rising 50-day moving average and the 25,400 to 25,500 area are the likely support zone. That region also corresponds with late July resistance, making it the more natural place for buyers to reappear.
A more decisive bullish signal would be an end-of-day close above 26,350, clearing the top of the recent gap. That would open the door to 27,300, a potential new record high, by the end of next month.
Dow: A Test of Channel Support Cannot Be Ruled Out
The Dow looks more vulnerable than the other major indices. It appears keen to test the floor of its rising channel from late March, alongside the 50-day moving average.
That support zone lies around 52,200 to 52,400. A retest would not necessarily damage the broader recovery story, but it may be needed before a fresh leg higher can begin. The chart has fallen comprehensively below the 53,300 gap, while RSI has slipped below neutral to around 46.
On the upside, the top of the channel near 54,200 remains the target. The period before Labour Day can often be a particularly enthusiastic one for US markets, so that level remains possible if sentiment improves quickly.
Bitcoin and Ethereum: The Crypto Revival Continues
Bitcoin needs to stay above $74,000
Bitcoin had already been giving advance notice of a recovery. It was repeatedly finding support above a rising 50-day moving average, while the $67,000 area acted as early resistance. The 200-day moving average near $68,900 was the best-case breakout level, and price has now gapped through it.
The next key hurdle is $78,000. A sustained break there would point towards $82,000, where May resistance comes into play.
- Support to hold: $74,000, previously resistance on the way down.
- Breakout level: $78,000.
- Upside target: $82,000.
Above $74,000, the technical bias remains towards further upside. Crypto, though, remains a market where a dramatic rally can turn into a painful reversal very quickly. It is not for widows and orphans, and perhaps not for many others either.
Ethereum confirms the strength of the sector
Ethereum was arguably an even cleaner early indicator for a crypto revival. It spent roughly six weeks moving sideways above a rising 50-day moving average. That sideways shuffle above a rising 50-day line is often the base for a significant breakout, and the move has now arrived.
Ethereum has pushed easily through its 200-day moving average around $2,003 and is approaching the $2,450 to $2,500 band, which marked resistance in April and May. A breakout through that zone should bring the old broken support near $2,800 into view.
The setup is strong, but it is still worth remembering that crypto enthusiasm can be temporary. The chart matters, but risk management matters just as much when the moves become parabolic.
Gold: A Golden Cross Setup With $4,800 in Sight
Gold has delivered a sizeable upside push and reached the 200-day moving average near 4,514. That level should now become support. Above it, the next target is the former May resistance zone around 4,800.
The important feature here is the moving-average configuration. Both the 50-day and 200-day moving averages are rising, with a potential golden cross developing. A golden cross occurs when a shorter-term moving average rises above a longer-term moving average, and the run into that event can often be the strongest phase of the cycle.
- Key support: 4,500, with a failure level near 4,320.
- Initial target: 4,800.
- More ambitious target: 5,500 by the end of next month.
The 5,500 call is punchy, but the current technical picture is certainly not weak. At this stage, sustained action back below 4,500 is not the expected outcome.
WTI Crude Oil: Above $87, the Channel Points to $100
WTI crude oil has done exactly what the chart wanted it to do, even without an obvious news catalyst. It has reached the top of its falling trend channel at $87.
Above $87, the next resistance is near $93, followed by the top of the wider channel from June at $100. A move to $100 by the end of next month would have obvious geopolitical implications, so it is not necessarily a target anyone should be cheering on.
For now, the bullish case remains in place while crude stays above $85.
SpaceX: The 50-Day Moving Average Is the Key Level
SpaceX came under pressure after the release of 319 million shares, but the pre-market action suggests a recovery attempt. The first target is the 50-day moving average at 142. Above that, the longer-term objective is the 200-day moving average at 156.
The risk remains on the downside if the price continues to sit beneath recent support at 136. The longer it remains below that level, the greater the chance of a proper retest of 130, an area tested at 130.39 recently.
Small-Cap Share Charts to Watch
- Avacta: A 63p to 70p range for now: Avacta has bounced enough to suggest the floor of its channel has been found around 63p. Resistance sits at the 50-day and 200-day moving averages near 70p. That creates a clear range for the time being. A move above 70p would point towards 80p.
- Amigo: Breakout above 2.75p could target 5p: Amigo is starting to do big things. The shares are breaking resistance at around 2.75p, and both the 50-day and 200-day moving averages are rising. As long as the price remains above the floor of the latest gap near 2.5p, the target is as high as 5p by the end of October.
- Blue Star: Crypto strength could revive the shares: Blue Star has been a dead duck for some time, but the technical tone is improving. The shares have broken resistance around 4.75p and moved through the 50-day moving average at 5.1p. Above 5p, the chart points towards 8.5p, with a possible 8p to 12p range by the end of next month if the wider digital-assets theme remains supportive.
- BSF: A gap-fill target at 2p: BSF has broken recent resistance around 1.22p. RSI has bounced above neutral 50 and the 50-day moving average is now rising, providing the ingredients for a larger move. The immediate aim is to fill the gap towards 2p by the end of next month. It is a punchy target, but the chart is now set up for it.
- B HODL: Sideways action could be building a stronger base: B HODL has been buying back shares, and the chart is beginning to form a sideways shuffle above its 50-day moving average. The moving average is not yet rising, but if it starts to turn higher, the setup improves substantially. The 5p area looks firmly established. Above that, the 200-day moving average near 7.5p is the target by the end of next month.
- Bluebird: Rising channel supports a 0.77p target: Bluebird has a rising trend-channel base in place since May and is up sharply. While the price holds above the former resistance level at 0.05p, the top of the channel near 0.77p is the upside objective by the end of next month. The bears may have tried plenty of name-calling, but the chart is doing the talking for now.
- First Class Metals: Finally breaking higher: First Class Metals has broken higher, with the 50-day moving average at 2.83p acting as the critical support level. Staying above it should allow a retest of June resistance and the year highs by the end of next month. If the 50-day and 200-day averages both start rising, that could accelerate the upside further.
- GCM Resources: Momentum points to 20p: GCM Resources has broken through the recent levels with some force. The February peak at 12p and the triangle target around 14.12p have both been surpassed. The upper parallel of the triangle now points to 20p. While the shares hold above 14.5p, that target could arrive by the end of the month rather than the end of next month. Both the 50-day and 200-day moving averages are rising, which confirms the positive momentum.
- Hydrogen Utopia: Above 2.4p, 4p is possible: Hydrogen Utopia has recovered following the fundraising gap down. The key level is the top of that gap at 2.4p. Above it, the initial target is 2.8p, with a best-case move to 4p by the end of next month. The company remains one to watch in the sustainable-fuel space.
- Halo Minerals: A favourable risk-reward setup: Halo Minerals has a rising 50-day moving average from the lows, a pattern that can precede a larger move higher. While the shares remain above recent support around 9p, the minimum target is 11.5p, with 14p possible by the end of next month. With its Chile and copper angle, the chart offers a decent risk-reward proposition at these levels.
- Itaconix: Targets keep getting taken out: Itaconix has repeatedly looked like a strong contender, and the chart continues to justify that view. The first targets were 144p, then 170p, then 193p. Above 193p, the next major objective is 260p by the end of next month. Given the current pace, it could arrive sooner.
- Smarter Web: A steadier crypto-linked move: Smarter Web is back in business as Bitcoin rises, although it is moving in a relatively pedestrian fashion rather than acting as an outright leveraged crypto play. While the price stays above former resistance at 31p, the minimum target is 37p, with a best-case target of 47p by the end of next month. That could coincide with Bitcoin returning towards $100,000.
- TomCo: Strong candles point towards 0.42p: TomCo has had a difficult time, but the current chart is looking much more constructive. The shares have broken above recent resistance near 0.29p, with strong candles and a rising 50-day moving average supporting the recovery. The broadening-triangle target and 200-day moving average converge around 0.42p, potentially before the end of next month.
- Thor Explorations: Above 71p opens the way to 82p: Thor Explorations has pushed through its 200-day moving average and reached the top of its rising trend channel from June around 71p. An end-of-day close above that level would target 82p by the end of next month, or possibly sooner. Ideally, the shares should remain above the floor of the latest gap around 67p. There was plenty of RSI build-up before the advance, and the technical picture remains constructive while that support holds.
What the Moving Averages Are Saying
The recurring theme across the stronger charts is simple: prices holding above rising 50-day moving averages, often alongside rising 200-day averages. That combination tends to provide a better environment for sustained advances than a rally occurring below declining trend indicators.
For a broader explanation of how these indicators work, see this overview of moving averages. They are not guarantees, but they give a useful framework for defining trend, support, resistance and risk.
For now, gold, Bitcoin, Ethereum, GCM Resources and several smaller shares have the strongest momentum setups. The FTSE 100, DAX and Dow are more mixed, with key support levels needing to hold before the next confident push higher.
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.
