Zak’s Weekend Chart Round-Up

FTSE 100 Stocks

ARM Holdings (ARM): Push to 1,300p Expected

It has been an extraordinary week in the aftermath of the Brexit vote, which has influenced much more than politics. What we can see from the stock market is that this has been a great barometer of the sentiment swirling around both Westminster and the City of London. What is evident on the daily chart of ARM Holdings is that although this stock was very much in sideways mode going into the big day on June 23, since then we have seen some of the pent up price action work very much in favour of the bulls. The only hiccup in this respect was a final test for support towards the 50 day moving average, currently at 976p. Indeed, what will be key over the next couple of weeks is not only the 50 day line, but also the 200 day moving average, also rising at 996p. What we expect to see is the run up to a 50 day / 200 day golden cross buy signal, with the message being that the time going into such a configuration tends to be the most positive for a stock or market. On this basis it would not be too optimistic to call shares of ARM Holdings up as high as the top of a rising trend channel from this time last year. The resistance line projection of the channel is currently pointing as high as 1,300p, which should make for a decent 1-2 months target at the present rate of progress. At this stage only a break back below the former April resistance at 1,050p on an end of day close basis would even begin to suggest that the positive scenario envisaged for this stock will not pan out.

Carnival (CCL): 3,900p Zone in Focus

The past week has provided us with plenty of examples of what you see in the most volatile markets, including gaps, gap fill rebounds, and long wicked daily candles. All of these feature in the latest price action at Carnival, with the shares filling the floor of a February gap down to 3,034p, before rebounding sharply. The position as we end this week’s mayhem is that the stock has served up a bear trap gap reversal to the upside from below the initial June 3,277p floor. This would allow us to conclude that provided there is no end of day close back below this former support we could see the initial snap back of the recent past gather further momentum. Just how high Carnival could stretch is suggested by the top of a rising trend channel drawn in on the delay chart from as long ago as the beginning of this year. The channel has its upper parallel pointing as high as 3,900p – thereby equalling the peaks of January. The timeframe on such a move is regarded as being as soon as the next 1-2 months or less, given the latest squeeze.

WPP (WPP): Double 200 Day Line Bear Trap

WPP may not be in the front line of day trading situations among FTSE 100 stocks, but it can be seen on the daily chart how this situation has actually been a decent one for those looking for short term gains on a technical analysis basis. This is said in the wake of the June double 200 day moving average bear trap double dip, which implies that we could be due for a robust price action period for July. Indeed, the big plus point at the moment is the latest unfilled gap to the upside through the 50 day moving average, now at 1,576p. The rather simple assumption to make now is that provided there is no end of day close back below the 50 day line, we could be treated to decent upside within an overall rising trend channel which can be drawn in from as long ago as the end of December. This has its resistance line projection pointing as high as 1,800p and could be touched as soon as the end of this month.

Small Caps

Jersey Oil & Gas (JOG): 45p Technical Destination

Jersey Oil & Gas is a great example of what you would like to see in terms of a solid looking small cap recovery prospect. The main plus point here and source of bullish speculation has been the reclamation of the 200 day moving average, now at 14.96p, in April, and the progression since then with respect to the black line on the daily chart. The assumption to make now is that provided there is no break back below the floor of a rising September price channel / 50 day moving average at 18.14p, one would expect to see further significant upside. Just how high this could stretch is suggested by the 2015 resistance line projection, now pointing to the 45p zone. This is expected to be touched as soon as the end of next month at the present rate of progress.

Orosur Mining (OMI): Above 15p Targets 35p

Orosur Mining is a stock which is not just backed by private investors, but appears to have decent institutional backing as well. This idea is not difficult to appreciate given the overall set up which has been in place on the daily chart over the past couple of years. The big plus point though since the start of this year has been the slow burn to the upside within a rising trend channel which can be drawn in from as long ago as May 2015. The resistance line projection of the channel is pointing at a 35p target, something which could be hit as soon as the next 2-3 months. This is particularly the case if we are treated to a swift break of recent resistance from last month at 15p. At this stage only sustained price action back below the 50 day line at 11.41p would even begin to delay the upside scenario.