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, ASOS, ACG, Chesterfield, Empyrean, East Start, GS Chain, Incanthera, Integrated Diagnostic, Image Biometrics, Jangada, and Valereum.
Market action this week delivered a mix of false breakouts, decisive support tests and a handful of small-cap opportunities that are starting to show clear technical patterns. Below, I run through the major index picture, the crypto and gold setup, then a stock-by-stock breakdown of the more interesting microcaps that caught my eye.
As always, do your own research and treat these as chart-based observations rather than hard recommendations.
Big picture: indices
FTSE 100
The FTSE pushed above the top of the old rising channel, reaching a peak of 9,930, but the follow-through faded fast. The immediate support to watch is the November low around 9,574. For the bulls to regain control we need an end-of-day close back above 9,760 to revalidate a breakout and open the way to the October channel ceiling near 10,150.
On the downside the near-term breakdown levels are the 50-day moving average at ~9,480 and the floor of the June channel near 9,420. For now the hope is that the area around 9,574 will stem losses and form a higher low.
DAX
The DAX flashed a classic bull-trap gap higher followed by a sharp reversal — a two-day island reversal, which is a bearish sign. The only comfort is the bounce on Friday and the fact the index is back above a rising 200-day line.
As long as the DAX holds a higher low above roughly 23,400, it can consolidate in a trading range between about 23,500 and 24,000. A failure below the 200-day line would change the near-term outlook.
Dow
The Dow pulled back toward the 50-day area but remains, for now, above that line — a tentative higher low. Watch the channel floor from July near 46,700 and the 50-day near 46,600. The RSI is still above neutral 50, which is a small positive.
An end-of-day close back above November resistance at 47,500 would be a trigger for a run toward the channel top around 49,000–49,200, a move I would look for over the coming month if momentum returns.
Cryptocurrency
Bitcoin
Bitcoin remains under pressure. The only constructive note is a bounce from the RSI oversold area around 30. Price structure, however, looks like a bear-flag continuation. Until there is a clean break above about 97,000, the path implies a revisit of the late April/early May support near 93,000 and, if that fails, worse levels after that.
Technically, the 50-day crossing below the 200-day (a so-called death cross) is a negative backdrop for any sustained upside. If there is an interim rebound the realistic upside looks capped in the 103,000–104,000 area given recent RSI failures below neutral 50.
Ethereum
Ethereum mirrors Bitcoin’s caution. The coin has not decisively broken below the floor of the August channel around 3,020, which is the immediate downside target while it trades below the April uptrend line near 3,250. The 50-day slope is turning lower, so the trend environment remains uneasy.
Gold
Gold managed to reach resistance around 4,160 but closed back below that level. A decisive end-of-day close under 4,160 would open a test of the April rising trend channel around 3,990 or the 50-day near 3,929.
If constructive momentum returns and 4,160 holds as support, the metal still has a technical road to the one-year resistance near 4,600, though that looks ambitious to achieve by the end of next month.
Selected Small-Cap
I focus on names where technicals show clear levels and defined risk-reward. These are short takeaways with the key levels to watch.
- ASOS
Shares are showing bullish divergence: lower price lows in November while the RSI traced higher. The stock sits nicely above the 50-day line around 261p . A stretch target is the top of the triangle near 320p over the coming month, but a more conservative target would be the 200-day area just under £3.
- ACG Metals
After a sizable fundraise the shares have steadied above recent support near 10.80p. From a technical perspective there is scope toward higher levels and a potential move into early January targets up to around £14 if momentum holds.
- Chesterfield
The chart has delivered an upside spike test. The first target near 1.15p was hit and the next level to watch is about 1.75p by month-end, provided the stock stays above recent broken resistance around 1.35p.
- Empyrean Energy
A neat little bull flag is forming. The top of the range around 0.17p is the key hurdle. A daily close above that would set up a run toward the low 30p area. Keep an eye on the 200-day line for confirmation of a longer-term shift.
- East Star
Despite very strong JV news, the stock only made a modest move. It did hit the short-term target near 2.8p. If the market starts to fully price the quality of the partnership the share could reach about 4p by the end of next month while holding above the recent gap support near 2.2p.
- GS Chain
There was a trend-line break around roughly 0.25p followed by support being found at that level. From here a technical retrace to around 0.57p — and possibly the 200-day line — is plausible over the next month.
- Incanthera
The stock rewarded a long presentation with a sharp move: up roughly 50% this week. The rising 50-day pointed to momentum and a target around 5.5p at the 200-day line is realistic by month-end while price holds above the 3p level.
- Integrated Diagnostic Holdings
A less-talked-about name that has already cleared its first target (64p). The next target on the technical picture is about 90p by the end of next month, supported by an RSI rebound above 50.
- Image Biometrics
While not widely discussed, the stock sits above the 200-day and is trading toward the top of its channel. A move to about 1.4p is on the table before month-end if the 200-day and RSI remain constructive.
- Jangada
Price is close to the triangle target near 1.5p. Clearing that could trigger another leg up toward ~2.25p, with the broken resistance at 1.2p now acting as support.
- Valereum
The shares recovered after a pullback to about 6.25p. A move above the 200-day line near 8.81p opens the way to a higher target around 14p, possibly within the next month if RSI strength continues.
Practical checklist for traders
- For indices, use clear end-of-day closes to validate breakouts or breakdowns: FTSE above 9,760, Dow above 47,500, DAX holding above the 200-day.
- For crypto, remain cautious until Bitcoin clears the 97,000 area with conviction; a death cross is a bearish macro signal.
- Small-cap entries should be sized for volatility and have stop levels beneath the recent support or the daily close below the 50-day/200-day lines where appropriate.
- Watch RSI behavior: rebounds above 50 can indicate sustainable momentum; repeated failures below 50 warn of limited upside.
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.
