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, Audioboom, B HODL, Chariot, Mkango, Priority, Rockhopper, RentGuarantor, Stack BTC, Valereum.
The broader chart picture remains notably constructive. Equities have absorbed the recent strength in oil far better than many would expect, crypto has bounced sharply, gold has sprung a bear trap, and several small caps are attempting to build credible recoveries.
The key theme is simple: support levels are largely holding. The next job for the bulls is to turn nearby resistance into support through convincing end of day closes.
As always, do your own research and treat these as chart-based observations rather than hard recommendationsend-of-day
FTSE 100: A Bounce From the 50 Day Moving Average
The FTSE 100 has bounced from the floor of its rising trend channel and, importantly, from its rising 50 day moving average near 10,719. That gives the index a decent technical base from which to challenge July resistance.
The immediate hurdle is around 10,860. An end of day close above that area would be the signal that the index is ready to resume its advance towards the top of the channel and fresh record highs around 11,100. That target could come into view by the end of September, or more likely by the end of the following month.
On the downside, July support near 10,400 remains the significant level to monitor. A close back below the 50 day average would raise the prospect of a retest.
The relative strength index, or RSI, remains encouraging. It is in the low 50s and continues to respect an uptrend line in place since March. For background on how this momentum indicator is commonly used, see Investopedia’s RSI guide.
DAX: Holding Above 25,700 Keeps the Upside Case Alive
The DAX, like the FTSE 100, has been resilient despite the oil price spike. It is bouncing around the old July resistance area of 25,900 while remaining above its 50 day moving average at 25,700.
As long as the DAX stays above that moving average, the working target is 26,500 later this month. There was an earlier break of a support line, but the subsequent action has stabilised the chart sufficiently to keep the bullish interpretation intact.
Dow Jones: The AI Meltdown Has Not Arrived
Despite the noisy headlines around technology and AI shares, the feared market collapse has not materialised on the Dow. The index remains inside a rising trend channel, with scope for a move towards 55,500 by the end of next month.
The July resistance line around 55,400 has been broken, and the recent dip below the 50 day moving average increasingly resembles a bear trap. A gap higher and a subsequent recovery have strengthened that argument.
It is still an unusual backdrop. Strong equities and a strong oil price do not always sit comfortably together. The market is holding up for now, but it will be interesting to see what oil price level eventually begins to weigh materially on risk appetite.
Bitcoin: Range Break Could Open the Door to 93,000
Bitcoin has put in a welcome bounce, moving towards the top of its recent range near 82,000 and the upper boundary of a small bull flag. The important confirmation would be an end of day close through 82,000, or preferably above the nearby resistance line around 83,000.
A successful break would clear May resistance and point towards a new upside leg targeting 93,000. That would be the top of the broadening triangle that has developed since February, with the target potentially achievable by the end of next month or earlier.
Support appears established in the mid 70,000s, roughly 74,000 to 75,000. Bitcoin is also only two or three days away from a potential golden cross between its 50 and 200 day moving averages. A golden cross does not necessarily create an immediate price move, as the market often rallies ahead of the event, but it remains a positive technical milestone. More detail on moving averages is available from Investopedia’s moving average overview.
Ethereum: A Break Above 2,590 Targets 2,900
Ethereum is also pressing the top of a recent mini range. The range has support around 2,350 and resistance near 2,590.
A breakout above 2,590 would give the chart room to move towards the top of its channel around 2,900, potentially before the end of the month. Ethereum has already achieved its golden cross, adding to the more upbeat outlook following the strong move higher.
Gold: Bear Trap Recovery Targets 4,800 to 4,900
Gold has delivered a remarkable rebound after falling below 4,300, creating what looks like a bear trap. The immediate challenge is the 200 day moving average near 4,534. An end of day close above that level would be the preferred confirmation, although an end of week close would carry even more weight.
The rising trend channel remains in force, with its floor around 4,370. While gold stays above that area, the upside focus is the old April resistance zone between 4,800 and 4,900. That could be tested as soon as the end of this month.
Both the 50 and 200 day averages are rising. Gold may be two or three weeks away from a golden cross, and the run into that crossover can often be the strongest part of the cycle. This week’s recovery has already provided some evidence for that view.
WTI Crude Oil: Above 87 Keeps 93 and 100 in Play
WTI crude oil remains firm after breaking resistance around $85 and holding above the more recent resistance level near $87. While it remains above $87, the chart continues to point towards a retest of July resistance at $93.
The best case scenario is a push above $100 by the end of the month. Should oil pull back, the 50 day moving average just below $81 is the expected support level, rather than any major breakdown beneath it.
Space Exploration Technologies: Breakout Points Towards 155p
The RSI is bouncing above the neutral 50 level, another helpful sign. If the share price does weaken, the rising 50 day moving average around 136p is the notional support, and a move much below that level is not expected.
Small Cap Charts to Watch
- Avacta Group: A Bull Trap, but 65p Could Be the Floor: AVCT has been frustrating, which is not entirely unusual. A push above 70p turned into a bull trap and forced a retest of the rising-channel floor near 65p. With the CLN news now in place, 65p may prove to be the low. A recovery into the low 70s would be encouraging, while the best-case scenario remains around 80p by the end of next month.
- Audioboom: One of the Better Setups: Audioboom is showing one of the more encouraging formations. The rising 50 day moving average is providing support, which is generally a strong bullish feature. The RSI has rebounded from 50 and the broader uptrend line remains intact. Provided the shares stay above the 50 day average at 468p, the best case target is the top of the channel and the 200 day moving average around 556p to 557p by the end of the month. It is a much more promising look than the stock has offered for some time.
- B HODL: 5p Support and a 14p to 15p Ambition: B HODL is holding around 5p, with a best case target of 14p to 15p by the end of next month. The company has been buying back its own shares, which may help support the recovery case, although a decisive catalyst is still needed.
- Chariot: 3.2p Target Reached, 6.2p Is Next: Chariot has reached the second target at 3.2p, having first achieved the 2.4p objective. The next chart level above 3.2p is old support from 2024 around 6.2p. That 6.2p area is a best case target for the end of next month, with a more conservative time frame extending towards the end of the year. First, the shares need to break through 3.2p and, crucially, stay above it.
- Mkango: A One Year Uptrend Remains in Place: Mkango has bounced again from its uptrend line dating back to September last year. The first requirement is to finish the week above the 50 day moving average around 39p to 40p. If that happens, 45p becomes the near term target by the end of the month. A move to 47p or 48p by the end of next month would also be realistic. The longer term chart points to 60p, but the immediate task is simply to escape the recent 35p to 45p range.
- Priority: Back Above the 50 Day Average: Priority has returned above its 50 day moving average at 1.14p with some force. The preferred confirmation is an end of day close through 1.22p, ideally above 1.25p. That would create scope for a move towards 1.66p by the end of the month. Following the latest announcement, the chart gives the impression that the company may be getting itself back on track.
- Rockhopper: The Falklands Concern Has Not Broken the Chart: Rockhopper has been included as an illustration of the market concern around the Falklands. Questions have been raised over UK policy towards domestic energy production and whether that could ultimately affect Falklands developments. For now, the chart is signalling that the market does not believe the Falklands are about to change hands. Rockhopper has bounced from the floor of its range, with 68p the area to watch.
- RentGuarantor: Vertical Momentum Still Intact Above 86p: RentGuarantor has experienced some negative noise following its major rally, potentially reflecting the pressures created when a market maker is caught short. Whatever the background, the technical setup remains constructive while the shares are above the top of the gap at 86p. Above the floor of the channel near 80p, the 120p target remains in play. The move is close to vertical, so volatility should be expected, but the chart has not yet invalidated the bullish case.
- Stack BTC: Aiming for the 200 Day Moving Average: Stack BTC has pulled back and now appears to be rebuilding a more bullish setup. The 50 day moving average could begin rising within a day or two, and the shares already put in a decent up day earlier in the week. The target is a relatively modest 7.5p by the end of the month, which would bring the shares towards their 200 day moving average.
- Valereum: Break 4.2p and 6.65p Becomes the Target: Valereum has also been rebooting itself recently and is attempting to clear initial resistance around 4.2p. A sustained move above that level, either immediately or early next week, would put the 200 day moving average at 6.65p in play. After gapping higher and consolidating above a rising 50 day moving average, the chart has one of the stronger technical setups. The 6.65p target could be achievable by the end of the month if the resistance break arrives.
The Levels That Matter Most
- FTSE 100: A close above 10,860 supports a move towards 11,100, while 10,400 is key support.
- DAX: Holding above 25,700 keeps 26,500 as the upside objective.
- Bitcoin: A close above 82,000 to 83,000 would strengthen the case for 93,000.
- Ethereum: Clearing 2,590 would point towards 2,900.
- Gold: A close above 4,534 would reinforce the recovery towards 4,800 to 4,900.
- WTI crude: Above $87, the market can continue to target $93 and potentially $100.
- Valereum: A break above 4.2p would bring 6.65p into view.
The overall bias remains bullish, but the emphasis is on confirmation. Rising moving averages, RSI support and successful retests are useful ingredients. The decisive signal is still a clean end of day close through the relevant resistance level.
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.
