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, Amazing AI, Alkemy, Ajax, Cyanconnode, Eurasia, Europa, GS Chain, Jangada, Mila, and Upland.
Markets finished the week with mixed messages. A number of indices and commodities bounced off long-term trend lines, while others remain under pressure and vulnerable to further downside. The picture is one of technical opportunity – short-term rebounds are possible, but confirmation matters: moving averages and the RSI will tell the tale.
As always, do your own research and treat these as chart-based observations rather than hard recommendations.
Quick takeaways
- FTSE 100 looks to have found a floor inside a rising channel and closed back above its 50-day moving average.
- DAX remains weak after breaking below its previous channel and may need to test deeper April gap support.
- Dow is trying to hold the rising channel floor; a close back above the 50-day MA and RSI above 50 would be constructive.
- Bitcoin and Ethereum remain downside-risk markets while they trade below key uptrend lines and former support levels.
- Gold is the bright spot, holding above its 50-day MA and heading toward resistance around recent highs.
Major indices and macro movers
FTSE 100
The FTSE bounced strongly from the floor of its rising trend channel that began in June. The week closed with a hammer candle and an end-of-week close back above the 50-day moving average at 9,511.
- Near-term target: 9,600, with upside into the 9,650-9,700 area if momentum continues.
- Upside scenario: push toward the top of the channel and a run at 10,000 by year end – optimistic but not impossible.
- Downside risk: a breakdown below the channel floor at 9,440 opens October support near 9,276.
- Watch the RSI: it sits below the neutral 50 at roughly 43. Conservative traders can wait for RSI back above 50 for confirmation.
DAX
DAX has taken a heavier hit and is trading below the floor of the previous rising channel. A tentative bounce around the June support near 23,000 is in progress, but the market still looks vulnerable.
- Primary concern: a test of the April gap floor close to 22,600 before a lasting base can form.
- RSI has faded below the neutral area into the low 40s, which increases the chance of further weakness.
- Any gap-down moves should be treated cautiously until the RSI and price action stabilize.
Dow Jones
The Dow is trying to hold the floor of its rising trend channel. The channel itself can be a movable reference, but support in the 45,700 area (early October) is key for near-term stability.
- Immediate support: 45,700, with secondary support around 45,500 and September’s low near 45,000.
- Healthy confirmation: an end-of-day close back above the 50-day moving average around 46,665 and an RSI back above 50.
- Year-end upside: the top of the channel sits just under 49,000, but that remains a stretch unless momentum improves.
Cryptocurrencies
Bitcoin
Bitcoin faces a fragile setup. The market already traded down to the 86,000 level that many did not want to see, and it sits below the March uptrend line currently near 87,000.
- Risk scenario: while below this uptrend, downside to roughly 76,000 remains possible.
- Near-term: consolidation between 76,000 and the high-80,000s is the likely range to watch until a clear breakout or breakdown occurs.
Ethereum
Ethereum tried hard to stay above 3,000 but slipped as low as 2,622 before a modest bounce. The old support zone near 2,950 now acts as resistance.
- Downside risk: while below ~2,950, a move back toward July’s support at 2,500 is possible.
- Positive note: RSI bounced from oversold levels around 30, and there are hints of bullish divergence – a reason for cautious optimism, but not a buy-and-forget signal.
Commodities
Gold
Gold is the relative outperformer. Price is above a rising 50-day moving average (around 3,973) and has cleared the top of an older April channel near 4,000.
- Short-term target: retest recent November resistance around 4,250.
- Year-end case: a move toward 4,600 is plausible if the current momentum holds.
- RSI is constructive, sitting in the low-50s at about 53.
Stocks on the bulletin
Here are the technical setups and practical levels to watch for a selection of mid and small-cap names showing either breakout potential or stage-one bounces.
Amazing AI
- Breakout: closed above recent resistance at roughly 0.30p on an end-of-day basis.
- Targets: short-term aim up to about 0.85p, with a longer-term top of the falling channel available further out.
- Key: staying above 0.30p improves the technical case; currently a bounce after an extended oversold period.
Alkemy Capital
- Near support held: recent resistance around 300p now acting as support.
- Targets: top of the rising channel near 375p, and a grander target through old December peaks near 445p
- Indicator: RSI has consistently bounced above 50 on dips since early last month, which is a constructive sign. 50-day MA sits around 236p.
Ajax
- Momentum pickup after a showcase event and acquisition news.
- Targets: channel top near 7.25p, with upside potential toward 12p by late January if momentum continues.
- Support: keep an eye on the 50-day line near 4.12p.
Cyanconnode
- Shares have finally broken out of a falling wedge/triangle that had been in place since spring.
- Immediate objectives: reclaim the 50-day moving average around 6.12p and a best-case end-of-year target near 9p.
- Critical level: remain above the breakout point near 6p.
Eurasia
- Notable push through the rising 200-day moving average, which signals improving medium-term momentum.
- Targets: the top of the former falling channel near 6.25p is plausible in the near term while price stays above around 4.30p.
Europa
- Continued climb inside a rising channel. The floor around 1.6p has held well.
- Potential: channel top toward 2.5-2.6p by the end of next month while the uptrend and the RSI uptrend remain intact.
GS Chain
- Director buying helped the stock; first target near 0.54p.
- Further upside to April resistance near 0.80p is possible by the end of next month if price holds above the 50-day MA near 0.32.
Jangada
- Exceeded a prior target near 1.5p and now targets the upper parallel of a broadening triangle near 2.25p by end of December.
- Key short-term support: remain above recent resistance now acting as support in the 1.44p area.
Mila
- Mining sector: clear rising channel since June. End-of-year target around 3.25p while above the channel floor near 1.9p.
Upland
- Strong chatter on social channels, but technicals have held up regardless.
- Trend: rising channel from July pointing to a target near 3.5p by end of December while above 2.5p.
How to use these signals
- Trade with confirmation: for indices and larger markets, wait for end-of-day closes above moving averages and RSI back above 50 for a cleaner long bias.
- Manage risk: use defined stops under channel floors or recent support levels to limit drawdowns.
- Look for divergence: bullish divergence on RSI after a lower low can be an early sign of a bottom, but it is not a guarantee.
- Scale positions: consider phased entries on bounces and add on confirmed breakouts rather than all-in entries.
Final thoughts
Technical overlays are pointing to a patchwork market. Gold and a handful of smaller stocks are showing clean setups. Major indices and crypto still need confirmation to move decisively higher. Respect the levels, keep stops in
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.
