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, Aterian, Arrow, Block Energy, Eden, Funding Circle, genedrive, Orcadian, Reabold, Scancell.
Short-term technicals are signalling caution across several major markets. Indices have kicked off a mild pullback, cryptocurrencies look shaky around their 50-day moving averages, while gold continues to outperform. A handful of small caps are showing fresh momentum and deserve a place on the watchlist.
As always, do your own research and treat these as chart-based observations rather than hard recommendations.
Below is a concise chart-driven summary of the key levels, market behaviour and trading scenarios to keep an eye on.
Major indices
FTSE 100
The FTSE peaked just above the top of its rising trend channel near 10,220 and the feared bearish divergence in the RSI has produced a roughly 1% pullback. Short-term support around 10,160 did not hold, so the next floor to watch is the base of the October rising channel at about 10,000 — a meaningful psychological and technical level.
If 10,000 gives way, the nightmare scenario is a slide to the 50-day moving average around 9,828. The one constructive note is the RSI sitting at 58, still above the neutral 50 line, which leaves scope for a bounce as long as it stays above that midpoint.
DAX
The DAX has gapped down and slipped back below the old October resistance at 24,700. Absent a close back above that level, the 50-day moving average at roughly 24,200 is the next area of interest. This weakness undermines any near-term case for a rapid push to the best-case target of 27,000 by the end of next month.
Political headlines have been a clear driver of the recent volatility. Markets tend to react first to uncertainty, so short-term risk remains elevated until price can reclaim key resistance levels.
Dow
The Dow remains range-bound between about 48,800 and just below 50,000. There is an uptrend line sitting around the 49,000 area — a break below that would put the lower range floor at 48,800 in play. Worst-case on a deeper pullback is the 50-day moving average just under 48,000.
RSI readings remain constructive, so a clean continuation higher is still possible unless fresh risk aversion pressures equities lower.
Cryptocurrencies
Bitcoin
Bitcoin suffered a bull-trap break above 95,000 and then came very close to testing the 50-day moving average near 90,400. The immediate conditional plan:
- Bullish scenario: bounce from here and retest 95,000.
- Bearish scenario: an end-of-day close back below the 50-day MA opens the door to the uptrend line from October near 86,000.
RSI is below neutral at about 47, which is not a great look for bulls in the short term.
Ethereum
Ethereum shows a similar pattern to Bitcoin but with a clearer 50-day test. Price has touched the 50-day moving average around 389 — a potential buying point for aggressive bulls seeking a move back up toward 3,300+ while the market holds above the 50-day on an end-of-day closed basis.
If the 50-day is lost, the uptrend line from April around 3,007 becomes the next structural support to watch.
Gold
Gold remains the standout performer. The chart continues to point higher and a target of 4,800 by the end of next month looks achievable — possibly even sooner. A resistance projection now heads toward around 4,900 as the near-term target.
Key support levels to protect the bullish case are recent support near 4,540 and the latest gap floor at about 4,620. An end-of-day close back below those levels would weaken the uptrend.
Small – Caps and Watchlist
Several smaller names are showing interesting chart action and clear trade levels. The following summarises the setups, targets and invalidation points to monitor.
- Aterian — January made lower lows while the RSI held steady (bullish divergence). A decisive end-of-day close through 25p targets up to 35p by the end of next month. An EOD close back below 23p would negate the upside scenario.
- Arrow Exploration — Two recent gaps higher, one in December and another now, suggest the worst may be over. Above the 50-day at about 12p, a move to the top of the broadening triangle near 17p is plausible. RSI uptrend has also held.
- Block Energy — Has gapped through a rising 50-day and reached the 200-day area around 0.87p. An end-of-day close above the 200-day line would put the top of the range toward about 1.15P in play.
- Eden Research — Surprise rebound with both 50- and 200-day moving averages now rising. The immediate target is the top of the range near 4.25p, with the next resistance up toward roughly 6.25p.
- Funding Circle — A notable update and a level to watch: holding above old November resistance at 140p opens a path to around 170p by the end of next month. This is a punchy call and could still prove a bull trap, so position sizing and risk management matter.
- Genedrive — Announced potential for a £6m fundraise. The share price sits on a rising trend channel; while it holds above the 200-day (1.02p), the channel top toward about 1.5p is targetable.
- Orcadian Energy — Despite sector headwinds, previous target at 18p has been hit. Above that, the upper parallel of a rising trend channel from summer 2024 points toward about 35p, potentially by the end of next month.
- Reabold Resources — The recovery has been held and the second target at around 0.09p was reached. Above that, the upper channel line could see moves toward about 0.17p. Key short-term support to keep the bounce intact is around 0.11p.
- Scancell Holdings — Hit the target near 13.5p. If momentum continues, the next channel parallel could take the shares to roughly 17p next month. Recent broken resistance just above 12p is the immediate level to defend.
What to watch next
- RSI relative to the neutral 50 level across indices and cryptos — staying above 50 keeps the constructive case alive.
- End-of-day closes relative to 50-day moving averages — clean daily closes beneath those averages tend to signal more meaningful pullbacks.
- Key psychological and technical floors: FTSE 10,000, DAX 24,200 (50-day), Bitcoin 90,400 (50-day).
- Gap floors and prior resistance zones on individual stocks — a gap fill or hold can be the difference between a bull trap and a fresh breakout.
Markets remain sensitive to headline risk and momentum signals. Trade setups with clear invalidation points and disciplined risk management are the practical way to navigate the current patchy picture. More updates tomorrow.
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.
