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, Andrada, Asiamet, Caledonian, Gfinity, Made Tech, Physiomics, Prospex, Reabold, Thruvision.
The broad market tone remains reasonably constructive, but major indices show enough warning signs to warrant close attention to support. Oil continues to lead, gold is trying to regain its footing, and crypto remains in consolidation after last month’s strong move.
On the small-cap side, several technically interesting situations are developing. Some charts are breaking higher through resistance, while others need to hold key moving-average support before the more ambitious upside targets can come into play.
As always, do your own research and treat these as chart-based observations rather than hard recommendations
FTSE 100: Still in the Channel, but Momentum Is Fading
The FTSE 100 remains inside its rising trend channel, with the lower channel area around 10,750 and the rising 50-day moving average just beneath that, near 10,738.
As long as there is no decisive end-of-day close back below this zone, the preferred bullish scenario would be a break through late July resistance at 10,870. That would open the way towards the upper side of the channel around 11,100, which would put the index in record territory.
However, the price action over the past day or two suggests that a downside break is becoming the more likely near-term outcome. A break below the floor of the channel could lead to support around 10,600, with the July price-action floor near 10,430 as a deeper fallback.
The 200-day moving average remains the major worst-case support area. The index has not traded meaningfully below that line for many months, and previous attempts to test it have produced a rebound.
For now, the concern is momentum. The relative strength index has slipped below the neutral 50 level. A further decline would also break the RSI uptrend that has been in place since March, which would be an unhelpful technical development.
DAX: The 50-Day Line Is the Immediate Test
The DAX has bounced above its rising 50-day moving average, but it is now moving uncomfortably close to that support again. The key level is around 25,700.
An end-of-day close below the 50-day line would point towards the floor of the channel that has been in place since April, around 25,500 to 25,400. If the selling became more serious, the 200-day moving average near 24,700 would be the larger downside reference point.
The RSI has already failed at the neutral 50 level in recent sessions. That momentum weakness favours a move down towards channel support unless the DAX can quickly reclaim stronger footing above the 50-day average.
Dow Jones: A Potential Breakdown Ahead of the FTSE
The Dow has had a difficult week after the Monday holiday, including a gap lower. It is now sitting at the floor of a rising trend channel that dates back to late March.
If that channel support gives way, the next target would be a retest of the late July area around 51,500. On the upside, the market still has the awkward July resistance line near 53,500 to overcome.
The loss of the 50-day moving average around 52,900 does not help the bullish case, while the RSI is well below 50. In that sense, the Dow may be a day ahead of the FTSE in terms of a potential technical breakdown, even if the RSI trendline itself has not yet clearly failed.
Bitcoin and Ethereum: Consolidation After the Big Move
Bitcoin needs a break above 82,000 to 83,000
Bitcoin has been quiet in recent days, but importantly it has held on to most of the gains from the strong move in the middle of last month. The immediate trading range is broadly 75,000 to 82,000.
There may be a small flag or channel forming within that range, but the key issue is simply whether Bitcoin can break out. A move through 82,000, and preferably 83,000, would target the upper side of the broadening triangle in place since February. That gives scope for a move towards 93,000 by the end of next month.
On any downside shake-out, the top of last month’s gap around 72,000 is the level that should ideally contain losses.
Ethereum remains in a minimum consolidation pattern
Ethereum is also moving sideways, in what still looks like a minimum consolidation phase. The core range is around 2,350 to 2,570.
A break out of that range would put the top of the rising trend channel from February into focus, around 2,900. If there is a sudden pullback, the old May resistance level near 2,150 is the key support expected to limit damage.
Gold: Positive Structure Above 4,300
Gold has been a little awkward to frame, but the best fit still appears to be a rising trend channel. The channel floor is near 4,350, with some room down towards the recent low around 4,300.
The broader technical tone remains positive. Gold is attempting to rise above a rising 50-day moving average, while the 200-day moving average is rising too. As long as the price holds above 4,300, the initial objective is the 50-day line around 4,537.
The RSI has edged back to the constructive side of the neutral 50 level, which supports the recovery case.
WTI Crude Oil: The Strongest Major-Market Chart
Crude oil remains the standout market. The chart has been strong and appears to be getting stronger, with previous resistance now acting as support.
The upside target is the top of the rising channel from June, around $102 per barrel. That scenario remains valid while WTI holds above the broken July resistance area near $93.
Even if there is a breakdown, the expectation is that the mid-August peak around $88 should offer support. For now, oil remains the chart to beat among the major markets.
Small-Cap Share Charts to Watch
- Andrada: Holding above 5.9p keeps the 9p target alive: Andrada has suddenly attracted plenty of enthusiasm after a long period in which it did not exactly inspire the market. The technical message remains straightforward: while the shares stay above 5.9p, the next level is around 7.8p. The bigger target is the upper parallel of the rising channel from January, near 9p by the end of next month.
- Asiamet: 2.2p resistance is the gateway to 2.8p: Asiamet has reached the top of its rising trend channel near 2.2p, just ahead of the latest news. The important question now is whether the shares can decisively clear that level. A quick move through 2.2p would bring a red resistance projection near 2.8p into play, potentially as an end-of-October target. The challenge is that there appears to have been plenty of buying ahead of the news, so it may prove a case of whether the journey matters more than the arrival.
- Caledonian: Falling-wedge breakout above the 50-day average: Caledonian is not a stock that receives much attention, which is often exactly why the chart can become interesting. The shares have broken out of a falling wedge and moved above the 50-day moving average at 1.58p. While the shares remain above that average, the initial target is 2.4p, the area that acted as support in early June. The best-case target is 3p by the end of next month.
- Gfinity: A well-behaved technical setup: Gfinity has bounced above a rising 50-day moving average and is doing the right things from a technical perspective. The key support is 0.36p. While that level holds, the target is 0.60p by the end of next month. An upward turn in the 200-day moving average would strengthen the outlook further and raise the prospect of a golden cross, where the 50-day average moves above the 200-day average.
- Made Tech: Breakout points to 52p, then 63p: Made Tech has issued decent announcements over the summer and the chart is responding accordingly. The shares have broken above recent resistance at 45p, leaving the top of the current channel near 52p as the next immediate target. If the breakout gathers pace and the channel top is cleared quickly, a new target around 63p could come into play by the end of November. The chart has useful support from rising 50-day and 200-day moving averages, along with an unfilled gap to the upside.
- Physiomics: A punchy setup with a 0.86p target: Physiomics has been moving sideways above its rising 50-day and 200-day moving averages. That combination can produce one of the stronger technical setups, particularly when a period of consolidation follows an improving longer-term trend. While the shares remain above the 50-day line near 0.49p, the target is 0.86p by the end of next month. It is a punchy call, but it is matched by a punchy chart formation.
- Prospex: 10p possible after the 5.25p channel target: Prospex has continued to perform despite the usual scepticism that tends to surface whenever a share starts doing well. The first rising-channel target at 5.25p has been reached, but the shares are still progressing. The next major resistance line dates back to October and November 2023 and points towards 10p. At the current rate of advance, that level could be reached as soon as the end of next month. The key condition is that the shares stay above the former 5.25p target.
- Reabold: A gap through 0.65p could mark a rehabilitation: Reabold is showing the first signs of technical rehabilitation following the West Newton news. The shares have gapped up through 0.65p, and the next test is the 50-day moving average around 0.70p. Provided the gap holds around 0.65p to 0.66p, the target is 0.77p, potentially as soon as the end of the month. Both the 50-day and 200-day moving averages are rising sharply, which adds to the improving picture.
- Thruvision: Limited resistance between 2.4p and 4.75p: Thruvision has already enjoyed a stellar run, with the recent 1.75p target achieved. The encouraging feature now is the apparent lack of major chart resistance between the current 2.4p area and old resistance at 4.75p. While the shares stay above 2.4p, the target is 4.75p by the end of next month. That makes the chart one of the more interesting celebrity-investor situations, provided the key breakout support is maintained.
The Levels That Matter Most
The near-term market picture is finely balanced. The FTSE, DAX and Dow all need to respect nearby support, with RSI readings signalling that momentum is no longer as comfortable as it was.
By contrast, crude oil remains firmly constructive, gold is trying to stabilise above 4,300, and Bitcoin needs only a clean range breakout to revive the push towards 93,000.
For the smaller shares, the focus is simple: hold the rising moving averages, protect the breakout levels, and allow the charts to do the work. When support holds after a consolidation or breakout, the upside projections have a much better chance of being met.
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.
