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, Artemis, GEO Exploration, Harena, Hydrogen Utopia, Mast, and WH Ireland.
Markets have been slipping, and a few key levels are being tested across major indices, crypto and gold. Below, I walk through what I am watching and the levels that matter right now, then finish with a look at the small-cap names I follow closely.
As always, do your own research and treat these as chart-based observations rather than hard recommendations.
FTSE 100
The Footsy remains under pressure. After last week’s record highs and the K star narrative, the market has started to pull back toward the initial October resistance around 9,577. Today closed below that level and we are looking at the risk of sliding back toward the 50 day moving average and the floor of the June rising channel.
- Immediate support being watched: 9,577 (old October resistance)
- Short term positive turnaround would require a sustainable move back above 9,650
- Near term downside could unfold over the next week or so if momentum stays weak
DAX
The DAX has not been in great shape recently. The market got stuck at resistance around 24,200 and has now gapped down through the 50 day moving average at just under 24,000. We are also back below the floor of the rising April trend channel.
- Key resistance recently: about 24,200
- 50 day moving average now just under 24,000 and has been sloping down
- Next downside risk is to the 200 day line around 23,300 while we remain below the 50 day
- RSI has failed the 50 level which adds to the downside risk
Dow
The Dow failed just below the top of the long channel from May last year, around 48,300. The immediate risk is a test of initial October resistance near 47,000. Worst case we could test the 50 day line roughly at 46,200, though we remain above the previous peak for now.
- Channel top resistance: 48,300
- Initial downside test: 47,000
- 50 day line to watch: 46,200
Bitcoin
Not good at the moment. Bitcoin lost the 50 day, failed the 200 day around 109,000 and now sits below the floor of the rising March trend channel close to 106,000. With an RSI failure around the mid 50 level and the price action since September resembling a head and shoulders with two right hand shoulders, the bias is clearly to the downside.
- Important levels: 200 day failure near 109,000, channel floor near 106,000
- Near target on a continued break: 98,000 and the June support area
- A return above the channel floor and back above about 106,000 would be the minimum requirement to flip the picture more positive
Ethereum
Ethereum has been flirting with the idea of a deeper test. The concern has been a test of the August support and the 200 day moving average near 3,330. We are a little above that right now but not by much. Below that lies the more uncomfortable scenario of going sub 3,000.
- Key support area: around 3,330 (August support and 200 day)
- 50 day moving average that previously failed sits higher, roughly around 4,125
- To stop the downside the market needs to reclaim higher trend support zones and move back above about 3,700
Gold
Gold is consolidating at the better levels but looks a little heavy while it trades under recent resistance around 4,040. The top of the old price channel sits near 3,950 and the 50 day moving average is around 3,834. While under resistance, the risk of a test of the 50 day line cannot be ruled out.
- Recent resistance: around 4,040
- Old channel top: near 3,950
- 50 day to watch: about 3,834
- Upside target from here would be earlier resistance on the way up near 4,170 if it can clear immediate levels
Small Cap Watchlist
The small cap slate is always a useful thermometer of market sentiment. Only a handful of stocks are showing interesting charting action right now.
Artemis
Artemis has rebounded off a rising 50 day and looks to have found a base. I am watching for a retest of last month’s peak around 6 pence plus. Staying above roughly 0.40 pence keeps the constructive case alive.
- Target: retest of 0.60p pence plus (peak last month)
- Support to hold: around 0.40 pence
GEO Exploration
GEO bounced off an old target line near 0.25 and then pushed above that. The cautious approach would be to wait for an end of day close back above the 50 day which sits near 0.34 before committing more, but the upside target still looks to be around 0.45 and maybe beyond if momentum returns.
- Short term trigger to confirm: daily close back above 50 day near 0.34
- Upside target: 0.45 or higher
Harena
Harena has staged a decent recovery and is back above the 200 day moving average around 1.85 pence. While it remains above that 200 day line the top of the channel around 2.5 pence is a sensible upside target given the current price action.
- 200 day: about 1.85 pence
- Target while above 200 day: 2.5 pence
Hydrogen Utopia
Hydrogen Utopia has taken a hit in recent months but has now reclaimed the 200 day moving average at roughly 1.66 pence. There have been three RSI 50 rebounds and support has built above a rising 50 day line. From here a move toward 2.75 pence is plausible while the 200 day remains in place.
- 200 day: around 1.66 pence
- Upside target: approximately 2.75 pence
- Positive signals: multiple RSI 50 rebounds and rising 50 day support
Mast
Mast has been beaten around but is attempting a fight back. Recent resistance sits near 34 pence while the mid teens area provided support from July. Getting back toward that 34 pence zone would be a good recovery, although the path up looks pressured with small daily candles showing limited conviction.
- Resistance to overcome: circa 34 pence
- Support: mid teens from July
WH Ireland
WH Ireland had an abortive deal with Oberon but has put in a decent recovery. The stock is moving sideways into positive candles, holding above the floor of the channel at about 1.3 pence, and the 200 day is nearby. The top of the channel around 2.15 pence is the best case target while the RSI skids along the neutral 50 which is a mild positive.
- Floor of channel / support: about 1.3 pence
- Top of channel target: 2.15 pence
- RSI: trading around the neutral 50 level which helps the constructive case
Summary
Overall the tape is a bit fragile. Major indices are testing important moving averages and channel floors while crypto has turned technically bearish until it reclaims key channel and 200 day levels. Gold looks heavy while below recent resistance. Among small caps a handful of charts are attempting recoveries, with clear levels to watch for each name.
I will be watching whether markets can stabilise around these support levels or whether the downside tests, particularly of 50 day and 200 day moving averages, become necessary. 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.
