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, Capital Metals, Critical Mineral, Critical Metals, Cloudbreak, East Star, GS Chain, New Frontier, Seeing Machines, WeCap.
Markets remain a mix of sideways congestion, selective strength and obvious chart study opportunities. Price action is telling different stories across commodities, indices, crypto and small-cap miners. Below are the key levels I am watching and the practical trading implications they suggest.
As always, do your own research and treat these as chart-based observations rather than hard recommendations.
Quick market snapshot
Overall, momentum indicators are mixed. Some markets are holding above longer-term moving averages which keeps the constructive case alive. Others are flirting with support and need decisive closes to confirm direction. Where RSI sits relative to 50 is especially useful right now: above 50 suggests bullish bias, below 50 means caution and the potential for further downside tests.
Oil
Oil attempted to break higher around the 100 area but stalled at the old June resistance, which also marks the top of the channel. The short-term structure looks more like a setback than a breakdown.
- Immediate support: 95.74 (November support)
- Low tested so far: 96.10
- Lower channel floor if broken: 94.20
- Broken uptrend line from October: near 96.97 — an end of day close above this helps the bulls
- Upside target: channel top around 101.50 for a year-end push
RSI is slightly above neutral at about 52, so the constructive case remains intact unless price convincingly falls below the November floor.
DAX
The picture is messy on the DAX but the fact price stays above the rising 200-day moving average is encouraging. Momentum remains tepid because RSI is under 50 and the market sits below the 50-day average.
- Key bullish trigger: end of day close back above the 50-day moving average near 24,000
- Near-term target if that closes above 50-day: move into the mid 24,000s
- Failure to reclaim the 50-day: likely test of the 200-day moving average around 23,400
Dow
The Dow remains above the 50-day and the lower boundary of the July channel around 46,500. That area looks like a natural place to mark a short-term low after last week’s run to the channel top.
Bitcoin
Bitcoin is showing a bear flag pattern and is testing the May support zone around 93,000. The price action is delicate and the rising trend channel seems to be widening, which increases the lower-tail risk.
- Support tested: 93,000
- Upside trigger: end of day close through 97,000 to open a move back toward 100,000
- Downside risk: below 97,000 risks a drop to the low 90s or even the upper 80s, with an example lower parallel near 88,000
Ethereum
Ethereum was threatened with a fall into the 30,000 zone but found a bottom inside the falling trend channel. The bounce avoided a sub-3,000 print and looks like an attempted recovery.
- Recent low: roughly 3,190
- RSI: around 37, resistance at roughly 44 — an end of day close above that line would be a useful bullish signal
- Initial upside target: 200-day moving average near 3,470
Gold
Gold gapped down and briefly set off a bull trap through the 4,160 area. Near term, the market looks set to test the 50-day moving average but I would not expect an end of day close below that level.
- Near-term support to watch: 50-day moving average near 3,938
- Broader projection: a run back up to the November resistance projection as high as 4,600 by the turn of the year remains possible if the 50-day holds
Small-Cap Watchlist
Several mid and small-cap names are showing technical setups worth tracking. These are short-term, chart-driven ideas with defined support and upside targets.
Capital Metals
- Setup: positive MRE upgrade
- Near-term target: around 5.25 pence has been recent resistance
- Year-end upside target: 7 pence along the indigo channel line
Critical Mineral Resources
- Action: bounced off the floor of a rising trend channel
- 50-day line close to watch: 3.75 pence — a clean end of day close above would be constructive
- Target: top of the channel near 6 pence by end of January
- Support: 3.25 pence recent low
Critical Metals
- Structure: potential island reversal pattern with a rising channel in place
- Target: top of the channel around 14 pence, possibly sooner rather than later
- Trigger: end of day close back above the rising 50-day moving average
Cloud Discovery
- Move: strong bounce off the channel floor and a break above recent resistance at 0.95 pence
- Near-term target: 1.6 pence next month, though volatility should be expected
East Star
- News-driven follow-through: positive reaction to last week’s JV
- Key levels: holding above 2.25 pence, target to the channel top near 2.88 pence and possibly 4 pence into year end
GS Chain
- Action: recovery gap higher
- Target: 0.55 pence aligned with the 200-day moving average and the August peak
- Support: 50-day moving average around 0.32 pence
New Frontier
- Setup: rising trend channel
- Short-term target: 1.3 pence possibly by the end of the month
- Best case through January: up to 2 pence if it holds above last month’s peak near 1.04 pence
Seeing Machines
- Progress: edging towards the first ambitious target
- Immediate level: 4.75 pence was the initial target; recent resistance broken near 4 pence
- January target: up to 6.25 pence, which sits on the rising channel parallel from February
WeCap
- Observation: market hasn’t fully rewarded the moves yet
- Target: 4 pence is the logical upside while maintaining above 2.75 pence
How I trade these setups
My approach is pragmatic and chart-focused. That means:
- Identify clear support and resistance and use end of day closes to confirm moves.
- Monitor RSI around the 50 mark to judge momentum tilt.
- Define precise entries, stops and targets based on channel lines, moving averages and recent swing highs or lows.
- Be ready to step aside if price action invalidates the setup with decisive closes beyond key levels.
Short-term traders should pay attention to end of day closes around the levels listed above. Swing traders and longer-term positions need to keep the bigger picture in mind: as long as major averages and commodity markets remain above key longer-term moving averages, corrective dips are opportunities rather than panic signals.
Summary
Several markets are holding constructive structures, but confirmation requires clear closes above the key moving averages and channel lines highlighted here. Crypto is the most delicate area with widening channel geometry and near-term downside risk if 97,000 on Bitcoin does not hold as a pivot. For small-caps, the technical setups offer defined risk-reward opportunities; stick to disciplined entries and manage risk with stops below recent 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.
