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, Delta Gold, East Star, Kazera, London BTC, Medpal, Prospex, RentGuarantor, Valereum.
The major indices feel slightly more cautious at the moment. Nothing has gone decisively wrong, but several charts are testing important support as momentum indicators begin to roll over.
Elsewhere, crude oil remains the standout winner, Bitcoin and Ethereum are consolidating constructively, and a number of small-cap shares are showing setups that could deliver meaningful upside if key support levels hold.
As always, do your own research and treat these as chart-based observations rather than hard recommendations
FTSE 100: Early Autumn Pullback Risk Remains
The FTSE 100 remains close to the recent support area around 10,680, which was previous July resistance. It is also still trading within the rising trend channel that has been in place since the end of March.
So far, the market has not broken down. However, the concern is that the Relative Strength Index has broken its own uptrend line and is showing signs of weakness. That could be an early warning that the index is preparing for a move lower.
- Key support: 10,680, then the 50-day moving average near 10,705.
- Bearish confirmation: An end-of-day close below the 50-day line.
- Upside potential: 10,900 if the floor of the rising channel continues to hold.
- Downside target on a breakdown: July support around 10,420.
For now, there is still some margin for error. But a close beneath the moving average would put the early autumn sell-off scenario firmly back on the table.
DAX: Bearish Turn Below 26,000
The DAX had been looking stronger than the FTSE, but the breakdown following the bull trap above 26,500 is continuing. The obvious area to watch is the 50-day moving average at 25,600, which also marks late July resistance.
Momentum has deteriorated as well, with the RSI slipping below the neutral 50 level to around 45. That favours a test of the 50-day line, particularly while the index remains below 26,000.
- Near-term resistance: 26,000.
- Main support target: 25,600 at the 50-day moving average.
- Technical backdrop: The failed move above 26,500 has turned into a bearish bull-trap pattern.
Dow: Channel Floor Is the Critical Level
The Dow is in a similar position to the FTSE. It is trading near the floor of its rising channel, around 52,700, and that support needs to hold.
The problem is that the RSI uptrend has already broken, and the indicator is now comfortably below 50. If the Dow cannot stay within the rising channel, a retest of July support around 51,400 to 51,500 could follow over the next week or two.
- Channel support: 52,700.
- Potential downside retest: 51,400 to 51,500.
- Recovery trigger: A break above 53,600.
At present, the upside break looks difficult. The chart needs to regain 53,600 before there is a convincing case for renewed strength.
Bitcoin: Consolidation With a 93,000 Target
Bitcoin is attempting to remain within its consolidation range. The working range is roughly 75,000 to 82,000, although the near-term move is still being capped by May resistance near 83,000.
The broader technical target remains 93,000, representing the top of the broadening triangle that has been developing since February. On the downside, the important support area is around 72,000, at the top of the previous gap.
- Current consolidation range: 75,000 to 82,000.
- Near-term resistance: 83,000.
- Big-picture target: 93,000.
- Key support: 72,000.
The 50-day and 200-day moving averages are both rising towards a golden cross, a pattern where the shorter moving average rises above the longer-term one. That crossover appears to be a week or two away. It can often coincide with the stronger stage of a cycle, although it remains possible that the best of this particular cycle has already passed.
Ethereum: Waiting for a Range Breakout
Ethereum remains trapped between support near 2,350 and resistance around 2,560. A breakout from that range is needed to get the next move underway.
The recent golden cross is a positive development. If the chart can push through resistance, the target is the top of the rising trend channel at 2,900, potentially by the end of next month.
- Range support: 2,350.
- Range resistance: 2,560.
- Upside target: 2,900.
- Fallback support: Around 2,200 if the breakout fails to arrive.
The bullish case is straightforward: clear 2,560 and head for the channel top. Failure to do so could mean a move back towards 2,200 before the market regroups.
Gold: 4,320 Must Be Reclaimed
Gold has disappointed by breaking through a series of support levels. The 4,320 area had been expected to act as support, but instead the price fell through it and reached 4,284.
To repair the technical picture, gold needs to get back above 4,320. That would open the door to a revisit of recent highs and potentially the rising 200-day moving average around 4,531.
- Level to reclaim: 4,320.
- Recovery target: 4,531 at the 200-day moving average.
- Downside support: 4,221 and the 50-day moving average.
The failure to hold above the rising 200-day line and the subsequent move back through it was a poor outcome technically. While gold remains below 4,320, the risk is for further pressure towards 4,221.
WTI Crude Oil: The Recent Market Winner
Crude oil has been the winner in recent sessions. The break above resistance at 85 has shifted the focus to the July resistance area around 93.
If momentum continues, the best-case scenario is a move towards 100 by the end of the month, which would align with the top of the June rising trend channel.
- Broken resistance, now support: 85.
- First upside target: 93.
- Best-case channel target: 100.
- Lower channel floor: Around 80.
The immediate downside looks limited while the price remains above 85. That former resistance level is now the key support to watch.
Small-Cap Share Charts to Watch
Delta Gold: A Favourite Technical Setup
Delta Gold has one of the more interesting setups. The shares are consolidating sideways above a rising 50-day moving average, which is one of the preferred patterns for a potential upside break.
- Upside target: 180p during September.
- Stop-loss level: An end-of-day close below the rising 50-day line at 137p.
The attraction here is the clearly defined risk. As long as the 50-day line holds, the consolidation has the potential to resolve sharply higher.
East Star: Above 5p, Looking Towards 10p
East Star surged following its update and remains strong. The shares had appeared to be making gradual progress within a rising trend channel, but the latest move suggests the pace may be quickening.
While the price remains above yesterday’s resistance at 5.9p, the near-term target is around 6.75p. The 15-day and 200-day moving averages have both been rising for some time, adding to the positive picture.
- Near-term support: 5.9p.
- Immediate target: 6.75p.
- End-of-year channel target: 10p to 12p.
The major historical resistance was around 5p, dating back three years, and that level has now been cleared. Above 5p, the bigger objective is 10p.
Kazera: Breakout Extends Towards 3.12p
Kazera had a strong update that was immediately well received. The shares not only cleared the first target at 1.88p but also moved close to resistance around 2.2p.
The next technical objective comes from a resistance line stretching back to 2024, which points towards 3.12p. That could be an end-of-next-month target, or an end-of-year objective for those taking the more conservative view.
- Key support: 1.8p, the recent broken resistance level.
- Recent resistance test: 2.2p.
- Next target: 3.12p.
Holding above 1.8p is the key requirement. The chart remains constructive while that breakout level acts as support.
London BTC: 2p Is the Line in the Sand
London BTC has had a positive announcement, but the chart still needs to break convincingly through the 200-day moving average at 2p.
A weekly close above that level would give the shares a clearer route towards 2.66p, potentially by the end of next month or sooner.
- Breakout requirement: Weekly close above 2p.
- Upside target: 2.66p.
- Core support: Rising 50-day moving average at 1.6p.
MedPal: Channel Target of 6p
MedPal received a boost following news concerning Eli Lilly’s Mounjaro and its heart-protecting properties. Technically, the shares remain within a rising trend channel dating back to March.
The target is 6p, at the top of that channel, by the end of the month. The bullish case remains intact while the shares trade above the 200-day moving average at 4.21p.
- Key support: 4.21p at the 200-day moving average.
- Channel target: 6p.
Orcadian Energy: Positive Gap and 24p Potential
The political discussion around opening up the North Sea remains difficult to read, particularly with competing pressures around net zero. Orcadian Energy would be a potential beneficiary of a more supportive direction for North Sea development.
The chart has responded positively, with a gap higher, and is heading towards 24p while it remains above the 200-day moving average at 15p.
- Key support: 15p at the 200-day moving average.
- Upside target: 24p.
The gap higher may be an early indication that the market is beginning to price in a more favourable outlook.
Prospex: Recovery in Progress
Prospex has broken above its 200-day moving average at 3.25p and now appears to be in a proper recovery phase. The shares are trading within a rising trend channel, with an initial target of 5.25p by the end of the month, or potentially sooner.
- Breakout level: 3.25p.
- Near-term target: 5.25p.
- Longer-term target: 10p by year-end if the first target is achieved.
If Prospex can reach 5.25p on schedule, the 10p area becomes a realistic bigger-picture objective.
RentGuarantor: Vertical Move Points to 120p
RentGuarantor has enjoyed a vertical move recently, helped further by the latest announcement. The rising trend channel points towards 120p, potentially by the end of next month.
- Broken resistance, now support: 80p.
- Upside target: 120p.
The technical picture remains positive while the shares stay above 80p. Above that level, the route towards 120p remains open.
Valereum: Rehabilitation Continues
Valereum looks as though it is rehabilitating itself. The shares have reached the first target at 4.1p, around the upper area of the rising trend channel from April.
The next level is the 200-day moving average at 6.65p, potentially next month. Before assuming that target is in play, the shares need an end-of-day close above recent resistance at 4.2p.
- First target achieved: 4.1p.
- Breakout confirmation: End-of-day close above 4.2p.
- Next target: 6.65p at the 200-day moving average.
The encouraging feature is the familiar setup of sideways consolidation above a rising 50-day moving average. That has already provided the basis for the current recovery move.
The Overall Technical Picture
The broad market message is one of caution rather than outright panic. The FTSE 100, DAX and Dow are all sitting near levels that matter, while weakening RSI readings suggest that support must be defended.
Crypto remains constructive but range-bound, gold needs to reclaim lost ground quickly, and crude oil is the clear momentum leader. Among the smaller shares, there are several well-defined breakout and consolidation patterns, with clear support levels to use for risk management.
As ever, the important point is not to chase every move. Watch the support, respect the moving averages, and wait for the chart to confirm the next direction.
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.
