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, Ajax, Amigo, Buccaneer, Cyanconnode, European Green, Mkango, Optima, Rockfire, Rift, RentGuarantor, Shearwater, Sealand, Xtract.
The main indices remain broadly constructive, although Bitcoin and gold are struggling to establish clear upside momentum. Elsewhere, crude oil may need one more dip before it can turn higher, while a number of smaller shares are showing the kind of chart breaks that can lead to sharp moves when the sellers finally clear.
As always, do your own research and treat these as chart-based observations rather than hard recommendations.
FTSE 100: 11,000 Remains the Number to Beat
The FTSE 100 reached the top of its rising trend channel from March and came within 10 points of the 11,000 level before retreating. That remains the key psychological and technical hurdle.
A sustained break through 11,000 should signal a fresh leg higher, with the natural top of the March channel pointing towards 11,500. That target could come into view by the end of next month or into early September.
On the downside, the first support zone is around 10,760 to 10,850, based on July resistance. That area should ideally contain any pullback. The wider worst-case support is the channel floor and 50-day moving average near 10,520, although that currently looks some distance away.
DAX: Breakout Still in Place Above 25,300
The DAX produced a breakout on Thursday and followed through to an extent on Friday, even if the early strength faded later in the session.
As long as the index remains above recent support at 25,300, the preferred scenario is a move towards 26,300 later this month or by the end of next month. The breakout remains valid, but holding above support is the important part.
Dow Jones: A Close Above 52,700 Could Open the Door
The Dow is attempting to clear a resistance line from the beginning of last month at 52,700. An end-of-day close above that level would improve the picture considerably.
That would bring 54,000 into play, with scope for a move as high as 54,700 by the end of September. The higher target comes from a projected November resistance line.
The RSI has moved back above the neutral 50 level, although it has been chopping either side of that marker and has not been especially helpful. On the downside, the key level is the 50-day moving average and April uptrend line near 51,700.
Bitcoin: Still Stuck in a Soggy Trading Range
Bitcoin remains indecisive. Support around 63,000 has been tested and the market has bounced, but the RSI is still below neutral 50 and the price is struggling to establish itself above the 50-day moving average at 63,400.
For now, the sensible working assumption is a range between 61,000 and 67,000. While Bitcoin stays above 61,000, a bullish break remains possible. In that event, the obvious upside destination would be the 200-day moving average, currently near 71,100.
Ethereum: A Better Setup Than Bitcoin
Ethereum has a slightly more encouraging chart than Bitcoin. It is consolidating above a rising 50-day moving average around 1,780.
Provided that level holds, the target is the 200-day moving average at approximately 2,095, potentially later this month. If the market does dip back to test the 50-day line, that would be the natural support area and the point where buyers of the market may become interested again.
Gold: Still Looking for Its Feet
Gold remains trapped in a broad range between 4,000 and 4,150. The 50-day moving average near 4,183 sits around the top of that range, while the projected support line from February points towards 3,900, a level that also acted as support in October.
The RSI has repeatedly failed around the neutral 50 area since the middle of May. That is not an attractive technical signal. It suggests gold is still digesting the earlier surge towards 5,500 in January and has yet to regain a convincing upward rhythm.
WTI Crude Oil: A Dip Towards the 200-Day Average May Be Useful
Crude oil has been highly sensitive to newsflow, particularly to the latest signals coming from Donald Trump. Friday’s important development was an attempt to fill the gap from earlier in the month near $87.
The 50-day moving average near $81.10 had been support, but weekend futures slipped below it, trading under $79. That creates the risk of a move to the 200-day moving average at $76.10.
That 200-day line is the notional entry area, even if the broader direction is ultimately higher. The market has already had an RSI rebound from 50 to around 55, so dips towards the long-term average can be viewed as potential buying opportunities rather than a reason to panic.
Small-Cap Share Charts to Watch
- Ajax Resources: Sellers May Finally Be Out: Ajax Resources rounded higher sharply on Friday after breaking recent resistance at 5p. The minimum upside target is the 200-day moving average at 6.44p. The more interesting prospect is a move towards 9p by the end of the month. The chart suggests a stock overhang may now have been cleared. When Ajax moves, it can move well, and the removal of that supply could explain why the previous weakness is now reversing.
- Amigo: Above 1.79p, 2.75p Is the Objective: The latest update appears to have been received well. The key level is the 200-day moving average at 1.79p. Above that, the target is 2.75p in the coming days, representing the top of the falling trend channel from late January.
- Buccaneer: Putting the Old Prejudices Aside: Buccaneer has disappointed for longer than many people care to remember, but the chart has now broken above its red downtrend line from the end of October at 0.011p. Above that breakout point, the target is 0.016p. A buyer mentioned activity in the shares on X, and while old prejudices are understandable, the chart break means it is worth keeping an open mind.
- CyanConnode: Recovery Channel Points Towards 10p to 12p: CyanConnode has been another difficult name historically, but the current technical picture is healthier. The shares have recovered from 6p in November within a rising trend channel and are trading above rising 50-day and 200-day moving averages.The immediate target range is 10p to 12p by the end of the month, potentially sooner. The upper parallel of the channel points to a best-case target of approximately 12.5p.
- European Green Transition: A Narrow Rising Channel With Further Potential: European Green Transition continues to trade within a rising trend channel that has been in place since the autumn. The top of the channel is currently around 12.88p, which is the immediate target for this month. The channel is relatively narrow, which raises the prospect of more upside if the current pace of improvement continues. A move towards 15p to 16p by the end of next month is possible. The principal technical requirement is that the shares remain above the 50-day moving average.
- Georgina Energy: Holding Above the Placing Price Matters: Georgina Energy reached the previously projected target at 14p, in fact reaching 14.8p, before the placing took some of the noise out of the story. The shares closed well around the old 10p target area. The longer they can remain above 9p to 10p, including the 9p placing price, the better the chance of another move towards 14p by the end of the month. The worst-case scenario would be a retracement towards the former May resistance near 8p before a recovery attempt.
- Mkango: A Close Above 40p to 40.5p Is Needed: Mkango has plenty of clever supporters, although the share price has not looked especially clever since the October spike. There is, however, an uptrend line from September running through roughly 35p. The next technical trigger is a proper end-of-day close above 40p to 40.5p. That should allow a recovery towards the 200-day moving average at 47p by the end of the month.
- Optima: Third Target Could Be 293p: Optima has already met an initial target at 229p and a second one at 248p. The next objective is potentially 293p by the end of the month. The chart remains constructive while the shares hold above recent broken resistance at 240p.
- Rockfire: Hold 0.12p for a Move Towards 0.16p to 0.17p: Rockfire generated excitement again after a strong finish to the week, with the shares spiking through recent resistance at 0.12p. That level now needs to hold. If it does, the near-term target is 0.16p to 0.17p by the end of the month. In a stronger scenario, 0.20p could be possible, but the shares would first need to stay above the 50-day moving average, at least on a weekly closing basis.
- Rift: A Slow Drift That May Finally Be Turning: Rift has been a slow drift, but it appears that the market may finally have absorbed the sellers that have been present from the start. Recent resistance around 6.5p has been broken. Above that level, the target is around 8p by the end of the month. As a helium play with a market capitalisation of around £9.4 million, it remains a cheap situation if the chart is indeed beginning to turn.
- RentGuarantor: 52p Is the Minimum Upside Target: RentGuarantor has maintained a strong social-media presence, and the technical picture is now supportive. The shares are above rising 50-day and 200-day moving averages, above recent broken resistance at 40p, and have produced two RSI rebounds from the 50 level. The top of the channel from around this time last year is 52p, which looks like the minimum upside target later this month. For those looking further ahead, a move towards 70p could be an autumn target, meaning by the end of September, if conditions remain favourable.
- Shearwater: Fresh Break Could Take the Shares to 74p to 75p: Shearwater has met the previous objective at the top of its falling trend channel near 57p. That breakout should now support a fresh move higher. The next target is the top of a broadening triangle from last summer, pointing towards 74p to 75p by the end of the month. The bullish case remains valid while the shares stay above the former 57p target zone.
- Sealand: Break Above the 200-Day Average Is Significant: Sealand has finally broken above the 200-day moving average at 0.03p. The minimum upside target from here is 0.04p, while the best-case scenario is 0.05p by the end of next month. The more interesting feature was visible before Friday’s move. The shares rallied and found support above a rising 50-day moving average that is coming off the lows. Combined with several clear candles closing near their highs, that suggests accumulation may be taking place.
- Xtract: 1.5p First, With 1.9p as the Bigger Prize: Xtract is another chart where accumulation may be building. The immediate target is 1.5p, representing the top of the current channel. The setup remains constructive while the shares hold above the sharply rising 50-day moving average and 200-day moving average, currently around 1.12p. For those looking for the larger move, an old line derived from the July 2023 peak points towards 1.9p by the end of next month.
Key Levels at a Glance
- FTSE 100: Break 11,000 for 11,500 potential; support at 10,760 to 10,850.
- DAX: Hold 25,300 for a 26,300 target.
- Dow: Close above 52,700 for 54,000 to 54,700 potential.
- Bitcoin: Range remains 61,000 to 67,000; 71,100 on a bullish break.
- Ethereum: Above 1,780, the 2,095 area is in focus.
- Gold: Still boxed between 4,000 and 4,150.
- WTI crude: A test of $76.10 may provide the next meaningful opportunity.
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 to 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.
