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, Gold, Ariana, Empire, GEO, GCM, Gunsynd, KR1, Nuformix, ProBiotix, Solvonis, Symphony, S-Ventures, Satsuma.
Global Market Indices: FTSE 100, DAX, and Dow
FTSE 100
The FTSE 100 is currently on track to reach the top of a rising trend channel established since spring last year, with a key resistance level around 9,040. Zak highlights the importance of an end-of-day close above this level, which could accelerate the upward momentum towards the next target near 9,230 by the end of August. On the downside, support is expected around the 8,908 to 8,910 range, which coincides with previous resistance and the floor of the channel. In a worst-case scenario, a sharp pullback could bring the index down to the 50-day moving average near 8,768, but with the mild recovery following last Friday’s pullback, such a drop seems unlikely at this stage.
DAX
The DAX shows a slight rebound, maintaining support at a rising 50-day moving average. This support level has held strong for about a month, with the upper channel target sitting around 25,000—potentially achievable by the end of July. Below that, initial support is near 23,800, with a further fallback to old March resistance at 23,500 if needed. However, caution is warranted as the recent gap down last week signals a possible market top, especially given the gap-up and gap-down patterns seen recently, which often precede reversals.
Dow Jones Industrial Average
The Dow is currently confined to a range between 44,000 and 45,000, with investors watching for a weekly close above 45,000 to signal further upside. Should this occur, the Dow could advance toward the upper trend channel line near 47,500 by the end of August. On the downside, initial support rests at June resistance around 43,100. Notably, the 50- and 200-day moving averages are converging, setting up a potential golden cross this week—a bullish signal often followed by strong market runs. This suggests the Dow may be poised for a solid breakout soon.
Cryptocurrency and Gold Outlook
Bitcoin
Bitcoin continues to impress as it pushes higher within a rising trend channel that began in spring last year. The immediate target is the channel top near 126,000, expected by the end of July, provided Bitcoin holds above July’s initial resistance around 117,000. The breakout above the 110,000 resistance level in May ended a two-month logjam, fueling momentum. While a retracement to 112,000 is possible before further gains, the path looks clear for additional upside. Looking further ahead, resistance from late March could mark the start of an acceleration channel, potentially propelling Bitcoin even higher by early autumn.
Gold
Gold has been somewhat overshadowed by Bitcoin’s recent rally but remains in a steady upward trend since March. The floor of the March rising channel sits around 3,270, with an initial target near May resistance at 3,430. Should gold break through this level decisively, a breakout similar to Bitcoin’s could drive prices toward 3,800 by the end of August. One caveat is that the Relative Strength Index (RSI) remains below the neutral 50 mark, indicating that momentum is not yet fully committed, though the recent close above the rising 50-day moving average signals readiness for a move higher.
Spotlight on Selected Stocks
Ariana Resources
Ariana has shown a strong bullish consolidation pattern known as a bull flag breakout above 1.5p. The initial target is around 1.88p, followed by the old February resistance near 2p, which could be reached by the end of July. Positive company news adds to the stock’s appeal.
Empire Metals
Empire Metals continues its relentless uptrend, recently breaking through the 30p level. The stock flirted with its fourth or fifth target at around 33.25p and now faces resistance near 38p. Staying above 30p is crucial for the bullish case, with the best-case scenario pointing to a test of that 38p level by month-end.
GEO Exploration
GEO’s shares are showing promise with a rising trend channel and steeply increasing 50- and 200-day moving averages. A minimum target of 0.23p is expected in the coming days, with a potential gap fill to 0.28p by the end of July. The stock recently bounced off the 50-day line, completing what looks like a cup and handle pattern—a classic bullish formation suggesting further upside.
GCM Resources
GCM Resources is displaying a strong turnaround pattern with a W-shaped recovery. Current price action near 5.25p aligns with the neckline of this pattern, with upside targets between 9p and 10p. The measured move from the formation’s depth suggests at least a 3.5p gain, potentially achievable by the end of July. Multiple RSI rebounds off the neutral 50 level reinforce the strength of this setup.
Gunsynd
After years of underperformance, Gunsynd has recently attracted renewed interest. The stock hit the 0.20p target from May last year and now aims to close above this level to fill a gap up to 0.25p by month-end. Maintaining support above October resistance at 0.16p is key. The rally was sparked by an unfilled gap off the lows, and with rising 50- and 200-day moving averages plus an RSI rebound, Gunsynd is poised for further gains. The longer-term target is the top of a falling trend channel near 0.50p, with a stretch goal of 0.72p by the end of August.
KR1
KR1 has broken above the 50-day moving average and experienced an RSI, signaling bullish momentum. Top of the trend channel at 50p, looking for that over the next week or two.
Nuformix
Nuformix is showing positive signs following a strong rebound last week. Both the 50- and 200-day moving averages are rising and approaching a golden cross, which may further boost the stock. The upper channel target is around 0.20p, potentially achievable by the end of July.
Probiotix health
We still have our line of resistance at 0.12p, which needs to be broken. We have an RSI rebound, with the top of the range around 0.20p by the end of next month, or possibly sooner.
Solvonis Therapeutics
Solvonis has rebounded impressively following a recent placing, trading well above the placing price of 0.3p. The stock is targeting 0.45p by the end of July, with support above initial June resistance at 0.32p. RSI bounces above neutral 50 complement the positive outlook.
Symphony Environmental
Symphony found support above 11p after a vertical move in May. The next resistance lies at the upper parallel of a rising trend channel projected from 2022, near 22p. Maintaining above 11p could see the stock reach this target by the end of August.
S Ventures
S Ventures has completed a V-shaped turnaround, breaking the neckline at 0.42p. The stock appears to be in a rising trend channel with a target near 1.6p by August. Initial resistance at 0.8p is the first hurdle to overcome for sharper gains.
Satsuma (also known as Tao Alpha)
Satsuma is navigating a rising trend channel with resistance around 10-12p. Breaking this level could propel the stock into the mid- to upper teens quickly. Support sits near 7.25p, with RSI holding above neutral 50. The stock has already gained 28%, indicating strong buying interest.
Conclusion
Overall, the markets and selected stocks covered here show a mix of cautious optimism and strategic setups for potential gains. Key indices like the FTSE 100, DAX, and Dow are testing critical resistance and support levels, with technical signals such as moving averages and RSI guiding the outlook. Bitcoin and gold each have clear targets within established trend channels, while several junior mining and resource stocks demonstrate promising chart patterns and momentum.
Investors and traders would do well to monitor these levels closely, as breaking above or below key resistance and support lines will likely dictate the next phase of market direction. Staying informed and disciplined with technical analysis remains paramount in capturing opportunities in today’s dynamic environment.
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.
