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, African Pioneer, Active Energy, Connecting Excellence, Eco (Atlantic), Empire Metals, Hot Rocks, Nuformix, Oxford Biodynamics, Sareum, WeCap, Westmount, Wishbone.
A compact technical read of major markets and a selection of smaller-cap stocks to watch as the year begins. The themes are familiar: moving averages, RSI behaviour, rising channels and clear support and resistance levels. There’s also a reminder that unexpected geopolitical shocks can change the picture quickly, so keep risk management front of mind.
As always, do your own research and treat these as chart-based observations rather than hard recommendations.
Major indices — what to watch this week
FTSE 100
The FTSE briefly pushed above the psychologically important 10,000 mark (high of 10,046) before slipping back. Key levels to note:
- Resistance on the way up: 9,920 (previous breakout area).
- Near-term support: 9,860 (bottom of the recent consolidation flag).
- 50-day moving average: 9,722 — a favoured re-entry zone if markets correct.
- Upside channel target: 10,100, with a stretch target up at ~10,500 into late February if momentum returns.
DAX
The DAX has been pushing toward its autumn highs. Watch the breakout above the October peak and the rising channel.
- Immediate resistance: 24,700–24,771 (October high).
- Best-case target: 25,700 (top of the April-derived channel) over the next month or so.
- Key support: the 50-day line around 24,000.
Dow Jones
The Dow has bounced above its 50-day moving average and shown a neutral-50 RSI rebound — both constructive technical signs.
- Near-term upside target: topping the February rising channel around ~49,200, with a stretch target of 50,000 by the end of next month in a bullish scenario.
- Downside risk: a test of the channel floor near 46,700, with the 50-day line near 47,550–47,576 as a preferred support level.
Cryptocurrencies
Bitcoin
Bitcoin has made a constructive start to 2026, clearing the 50-day moving average around 89,000 and moving back above neutral RSI territory.
- Initial resistance: 94,000 (December resistance).
- Best-case longer target: the 200-day moving average, near 106,000, by the end of next month if strength holds.
- Support to respect: recent December support around 85,000.
Ethereum
Ethereum has also reclaimed its 50-day moving average. The question is how quickly it can clear the next resistance band and test the 200-day area.
- Near-term target: 3,500, just below the 200-day moving average, possibly by the end of this month in a favourable scenario.
- Support levels: the 50-day at 3,006 and the April uptrend near 2,870.
Gold
After a very strong year, gold has shown some odd volatility — hitting the top of its channel then quickly retreating close to the lower end.
- Recent low: 4,274.
- Key support to watch: 4,250.
- Expect updates on the intraday price action as markets reopen and flows settle.
Small-cap watchlist — technical setups and targets
A selection of smaller names showing interesting technical patterns, from breakouts and rising moving averages to oversold bounces and bullish RSI divergence.
African Pioneer
A standout performer last week, helped by sector strength. The stock broke above the 50-day and looks to the top of its channel.
- Recent move: up nearly 50% over the week.
- Target: up towards 1.55p (top of channel from Feb last year).
Active Energy
The chart hints at a falling wedge breakout. Wait for a clear breakout above the 50-day to confirm the move.
- Watch for breakout: above 0.08p (50-day) for confirmation.
- Near-term target: 0.11p by the end of next month if momentum continues, while remaining above 0.007p support.
Connecting Excellence
A gap down in late December left the RSI at an extreme oversold reading. The RSI bounced off zero — rare and suggests at least a short-term technical recovery.
- Potential short-term target: 2.88–3p in early January if the reversal holds.
- This is a speculative turnaround based on extreme RSI readings rather than fundamental catalysts.
Eco (Atlantic)
Strong momentum after breaking the 200-day moving average and generating a golden cross. The path higher looks relatively clean between the breakout and the old peak.
- Progression hinted: 12p then 15p, with the old November 2022 peak near 45p as a larger target.
- Stretch target: mid-40s pence if the uptrend holds.
Empire Metals
Director buying and a break above a persistent resistance line have helped the technicals. Both 50 and 200-day lines are rising in parallel.
- Key support: 37p.
- Targets: upper 40s and potentially low 60s by the end of the month if momentum continues.
Hot Rocks
A favourite due to its strategy and exposure. Both moving averages are rising and there’s an unfilled upside gap above a rising 50-day.
- 50-day support: 1.36p.
- Target: 3.1p by the end of next month while above that 50-day line.
Nuformix
Popular on social channels and trading above its rising 50-day average. If the breakout sustains, there’s a clear channel target ahead.
- Current bias: above the 50-day at 0.29p.
- Upside target: 0.545p by the end of the month.
Oxford Biodynamics
The chart has been choppy with previous false dawns. That said, bullish divergence at the RSI level suggests upside potential if the stock holds its recent supports.
- Key support: mid-December support near 0.23p.
- Targets: a move to 0.27p then possibly 0.38p into the end of next month; a conservative objective would be 0.3p.
Sareum Holdings
A classic bullish setup: an RSI rebound above neutral 50, a sideways shuffle, and a U-shaped turn. This is the type of chart that can run quickly.
- Immediate support: the rising 50-day just below 14p.
- Target: 30p by the end of the month if momentum persists.
WeCap
A bounce above a rising 200-day is constructive, but the RSI still needs to reassert itself above neutral to convince cautious traders.
- Watch: end-of-day close above the 50-day at 2.32p for a clearer trigger.
- Potential upside: 4p by the end of next month in a positive scenario.
Westmount
The stock is trading in a rising trend channel since August and has already hit a near-term resistance area.
- Current base: above 3.4p.
- Short-term target: a retest of last month’s peak at 5.25p, with the upper channel toward 7.5p if momentum gathers.
Wishbone
A strong turnaround after bouncing above an August gap. The shares are now trading well into the 90s pence.
- Support: 50-day at 80p.
- Near-term target: 112p within the first half of January while the 50-day holds.
How to use this technical checklist
Technicals give a framework: identify the trend (rising/falling), check the 50- and 200-day moving averages, watch RSI around the neutral 50 level, and map clear support and resistance zones. Use those elements together rather than in isolation.
- Define the trend: are the 50 and 200-day moving averages rising or falling?
- Look for confirmation: price above a rising 50-day and RSI back above 50 suggests momentum.
- Mark levels: note immediate support, the nearest resistance, and the higher channel/200-day targets.
- Set stops: use the next logical support (50-day, trendline or a consolidation low) to size risk.
Markets start the year with momentum in a number of places, but technical setups can be derailed by sudden macro events. Keep the levels in mind, monitor price behaviour around moving averages and RSI, and manage risk accordingly.
More updates will follow as price action and economic news provide clearer direction.
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.
