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, Crude, Delta Gold, EnSilica, Feedback, Great Western, Guardian Metal, GreenRoc, hVIVO, Hydrogen Utopia, ITM Power, Light Science, Kazera, Strategic Metals, Switch Metals, Sanderson.
The latest chart setup across the major indices, crypto, commodities, and a handful of small-cap stocks is broadly constructive. At the moment, the stronger themes are breakouts, rising channels, support at key moving averages and a number of continuation patterns that still suggest higher levels ahead, provided the important floors hold.
As always, do your own research and treat these as chart-based observations rather than hard recommendations.
FTSE 100: a tight bull flag points higher
The FTSE 100 continues to shape up well technically. The standout feature is a very tight, narrow bull flag sitting above a rising 50-day moving average. That is usually the sort of pattern that signals continuation rather than exhaustion.
The market has effectively been telegraphing that it wants to head higher, regardless of whether the broader fundamental backdrop feels a bit less convincing.
The key trigger was a weekly close through 10,650. That should be enough to keep the market on course for at least a retest of the late February to early March resistance area around 10,920, which also ties in with the record highs.
If the move extends cleanly, the best-case target is 11,200 by the end of next month, in line with the top of the rising trend channel from October.
On the downside, the important support levels are:
- 10,500 in the near term
- The floor of the broader channel at around 10,340
With RSI around 62, the index still looks more like it is in a mid-move consolidation than at the end of a rally.
DAX: breakout through the falling channel
The DAX has produced a more straightforward breakout. It has pushed through its falling trend channel, and once the market cleared 23,800, the recovery phase looked properly underway.
Now that the index is back above the 200-day moving average at around 24,100, the next obvious target is the first major gap resistance near 25,100 to 25,200.
On any near-term weakness, the hope is that the market will not need to go materially below the 50-day moving average, which sits just under 24,000. As long as that area contains pullbacks, the chart remains constructive.
Dow: still the villain of the piece, but breaking higher
The Dow has been the awkward one for a while, arguably the villain of the piece, but the chart is now improving rapidly. The market appears to have decided that the worst of the geopolitical tension has passed, at least for now, and that has translated into a strong upward push.
The immediate focus is on 50,000, with a possible move to 52,150 by the end of next month based on the resistance projection running from November.
There are several bullish features here:
- A clean breakout structure
- Two unfilled upside gaps so far this month
- Momentum that remains very strong, even with RSI approaching overbought territory
The next thing to watch is the 50-day moving average at 47,900. If that line starts to rise meaningfully, the rally could accelerate further.
The first warning sign of a false start would be an end-of-day close back below 48,700, which was Thursday’s resistance.
Bitcoin: recovery still intact, but bears have a clear case
Bitcoin is at an interesting technical juncture. There has been some chatter that the recovery from the beginning of last month may already be complete, and that the recent high could turn out to be the top of the move.
The market came close to the 79,000 target, getting just above 78,000, but has so far fallen short of fully testing that resistance. That 79,000 area mattered because it was resistance on the way down after the break of the falling trend channel from August, around 73,000.
If the bears are right and that recent peak does mark the top of the rebound, the downside levels to watch are:
- 70,000 at the 50-day moving average
- 66,000 at the floor of the channel
For now though, as long as Bitcoin stays above 66,000, the broader recovery argument remains alive.
Ethereum: struggling at channel resistance
Ethereum spent several sessions trying to break through the top of its falling trend channel, near 2,440, but by the end of the week it had slipped back below that barrier.
That leaves the market in a recovery phase, but one that still needs to prove itself.
If Ethereum can reclaim and break above the top of that channel decisively, the next target would be the 200-day moving average at 2,856.
If not, then support comes in at 2,137, and a more bearish interpretation would point back towards the 2,000 area.
The encouraging part is the RSI setup. Momentum is still climbing above its own uptrend line in the RSI window, which suggests the recovery from February support has not yet fully rolled over.
Gold: needs to get back above 5,000 properly
Gold remains in a slightly awkward patch. The market is hovering near the top of the falling trend channel from January and close to the 50-day moving average at 4,899, but it has not yet delivered the kind of proper end-of-day close above that level that would confirm the next leg higher.
If that breakout comes, the upside target is roughly 5,200.
If it does not, then recent support around 4,600 could come back into play.
The positive here is momentum. RSI has rebounded from the 50 area and, despite sitting around the low 40s at present, there is still a chance that the recovery can be maintained if that momentum base holds.
WTI crude oil: a total gamble, as usual
Crude oil is, at the moment, even more of a gamble than it normally is. The market had been looking for 85.95, but on Friday it dropped well below that and traded as low as 80.56.
The issue now is trying to identify where the floor of the current channel actually sits. In normal conditions, the 50-day moving average would often provide a decent reference point, so for now the support area to watch is around 83.85.
If that area holds, there is scope for a move back towards 90 dollars, which was the early April support zone and may now act as resistance.
That leaves a likely trading range of roughly 80 to 90 dollars.
However, there is a note of caution. RSI has failed at the neutral 50 mark, which often suggests there is more downside pressure than upside momentum. So despite stronger weekend pricing around 86 dollars, the chart still leans towards further tests of the 80 dollar area unless momentum improves.
Stock charts in focus
A number of individual shares are setting up well, particularly those with rising channels, neckline breaks and support from moving averages. Some of these have already hit initial targets and are now pushing into more ambitious territory.
Delta Gold: above 85p, the bigger target opens up: Delta Gold has delivered exactly the sort of recovery the chart had been hinting at since the move above a rising 50-day line late last month. The break through neckline resistance around 49p was the key event. From there, the move to the top of the channel around 85p followed, and the shares have already moved above that level. The next target is now the upper parallel of the rising trend channel from the end of January, which points to as much as 126p by the end of next month.
EnSilica: 70p first, then possibly 95p: EnSilica has been moving well and came very close to the initial near-term objective, hitting around 69.5p. The first target remains 70p, but if the shares can establish themselves above that region, there may be room for a much bigger move. The upper parallel of the rising trend channel from roughly this time last year points towards 95p. Given the area EnSilica operates in and the current pressure on supply chains, it is not hard to see why the chart has been attracting interest.
Feedback: still approached with trepidation, but 22p is on the map: Feedback is one of those names that tends to inspire caution, but the chart is improving. There is a rising trend channel base running from September, and if the shares can remain above the 200-day moving average at 11.6p, the top of the channel around 22p becomes a viable target by the end of next month.
Great Western: early signs of a catch-up trade: There is an interesting narrative around Great Western potentially becoming the “new Guardian Metal”. That is a bold comparison, especially given the huge gap in market capitalisation, but the chart has at least started doing the right things. The first target, the top of the rising trend channel at 2.6p, has already been achieved. Above that, the next target is 4p by the end of next month, and perhaps even sooner given the recent pace.
The word doing a lot of work here is tungsten, which is clearly catching attention.
Guardian Metal: 350p remains the target: Guardian Metal has been one of the standout stories, and the chart still points higher. Using the latest rising trend channel from the end of December, the top of the channel is currently tracking towards 350p by the end of next month. The key condition is that the shares stay above the mid-April peak at 295p. While that support holds, the bullish structure remains in place.
GreenRoc: 6.5p not too ambitious: GreenRoc also looks well placed. The previous target of 4.75p has been met, and attention now shifts to the upper parallel of the rising trend channel from this time last year. That points to 6.5p by the end of this month, and given the current momentum, that does not look especially ambitious.
hVIVO: finally turning after a long spell in the wilderness: After what feels like a very long time doing very little, hVIVO is finally beginning to turn. The first target is the top of the channel around 10.75p. Above that, the upper parallel of the rising trend channel points towards roughly 15p by the end of next month. There is also a gap on the chart up to 16p, which offers a more optimistic target over the next four to six weeks.
Hydrogen Utopia: above 3p, 4.8p remains the goal: Despite all the headlines about a possible shortage of aviation fuel, Hydrogen Utopia has not moved as aggressively as some might have expected. Even so, the chart is improving. The key development has been the break of resistance at 3p. Above that level, the working target remains 4.8p, ideally by the end of next month or perhaps sooner if momentum improves further.
ITM Power: red line target at 197p: ITM Power has been one of the stronger names in green hydrogen and electrolyser-related themes. The chart had already been pointing towards the red line target near 91p, and the setup has since evolved. There is now a new resistance line from last July, and that projects up towards 197p. That is the target over the next couple of months, potentially by the end of June. The bullish case is strengthened if the shares remain above the mid-range of Friday’s price action, effectively the 120p to 125p area.
Light Science: regrouping after the placing: Light Science is trying to stabilise following the recent £6 million raise, which was an impressive financing effort in itself. Technically, the shares have broken above the bottom of last month’s chart gap at 1.4p. Above that, the next target is the 50-day moving average at 2.3p, possibly by the end of this month.
The RSI trend is supportive as well, with a clean uptrend line helping the recovery case.
Kazera: broadening triangle target at 1.7p: Kazera has broken above the top of its falling trend channel at 1.1p, and that now opens the way for a move towards the top of the broadening triangle that has been in place since October. That target comes in around 1.7p. The positive case holds while the shares remain above the 50-day moving average and, ideally, above the broken resistance line from spring last year.
Strategic Metals: one of the more lowly rated names: Strategic Metals looks particularly interesting on a fundamental basis, and technically the chart is behaving itself too. The break above the resistance target at the top of the October trend channel around 6p has improved the outlook. Above that, the upper parallel of the rising trend channel from October points to 9p by the end of next month. The progression here has been notably smooth, and ideally the shares now remain above recent resistance at 5.6p.
Switch Metals: the time may finally have come: There has been no shortage of enthusiasm around Switch Metals, but the chart now suggests that enthusiasm may finally have proper technical backing. The share has delivered a gap-close buy signal while staying inside a rising channel. The floor of that channel is around 12p, and from there the chart points to as high as 22p by the end of June, if not sooner. The rebound from a rising 200-day moving average strengthens the setup. More cautious traders may still prefer to wait for an end-of-day close back above the 50-day moving average at 14p.
Sanderson Design: quietly approaching the next breakout zone: Sanderson Design may not be the noisiest chart around, but it is shaping up nicely. The shares are moving towards the initial target at 66p. Above that, the upper parallel of the rising trend channel from this time last year points to 85p. As with many of the charts in this roundup, the key is holding above the 50-day moving average, which currently sits at 56p.
Final chart take
The broad pattern across markets is still one of recovery and continuation rather than breakdown. The FTSE 100, DAX and Dow all retain bullish technical structures, crypto remains in recovery mode unless key supports fail, and several commodity-linked and thematic small caps continue to benefit from rising channels and breakout patterns.
That does not mean every setup will work perfectly from here. Some are stretched, some are testing awkward resistance, and in markets like crude oil the chart can turn into a coin toss very quickly. But where price is above rising moving averages, above broken resistance and inside upward channels, it usually pays to respect the trend until the chart says otherwise.
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.
