Small Caps Review: Aquarius Platinum, Braemar Shipping, Oxford Biomedica

With leading stocks having hit record highs, at least in terms of the FTSE 100, it may be argued that recent months have seen that long awaited catch up game from the small caps area put on hold. Clearly some of this is a result of pre-general election caution, but it remains to be seen whether the big acceleration to the upside can trickle down from the top of the UK market towards the smaller capitalised companies. While we wait for this question to be answered, it may be worth looking at some of the brighter contenders amongst the minnows, to see whether they have been able to deliver some momentum of a positive kind to those who are fans of this particular part of the market.

Aquarius Platinum (AQP) is something of a private investor favourite and blast from the past. Here the main positive technical feature is the way that one can draw a line in the RSI window running up from the beginning of March. This is a bullish divergence line and one which could be a leading indicator on an extended turnaround for the shares. That said, caution may be advised, with traders choosing to wait on at least an end of day close back above the 50 day moving average at 9.72p as this feature has blocked the stock’s attempts at rallies since the autumn of last year.

It is interesting looking at Braemar Shipping Services (BMS), where we can see that the stock is attempting to break through the 200 a moving average currently standing at 456p. The ideal scenario over the next week or two is that we are treated to a weekly close above the 200 day line, a development which should be enough to allow the shares to accelerate as high as the top of a rising October price channel £5.10 over the following 4 to 6 weeks. The notional stop loss on the buy argument is an end of day close back below the 50 day moving average of £4.39, probably accompanied by sustained oscillator action below neutral 50 in the RSI window.

Next up is Oxford Biomedica (OXB), where the stock has been in a rising trend channel since October, one that has guided the shares to a decent breakout and a doubling of the share price since the start of the year. The view here is that there is support coming in towards the floor of last year’s channel/the 50 day moving average of 10.98p, with the assumption being that at least one above the 50 day line on an end of day close basis the target here could be as high as the autumn resistance line projection at 15p plus over the next 4 to 6 weeks.

We finish off the small caps review with a look at Sepura (SEPU), where it can be seen that there’s been a near vertical push above the 200 day moving average 142p. This coincides with the floor of a rising trend channel from November 2013, with the implication being that while there is no day close back below this notional double support zone then we could be treated to further significant upside. The favourite destination at this point is as high as the late 2013 price channel top at £1.70, a destination which could be hit as soon as the end of May or beginning of June.