USDX technical analysis for December 7, 2015

The US dollar index is bouncing as expected from the 38% Fibonacci retracement level towards the initial resistance of 99. Important medium-term resistance is found at 99.50, and only a breakout above it will ruin chances of reaching a lower low at 97.60.

Blue lines - upward sloping wedge broken

In the 4-hour chart above, we can clearly see why the price is bouncing higher. The price has reached the 1st important support of the 38% Fibonacci level and we should see some more upside towards short-term resistance at 99. Eventually, I believe that we should expect another rejection at highs and a reversal to new lows below the recent low.

In the weekly chart, the price remains above the weekly kijun- and tenkan-sen indicators and of course above the Ichimoku cloud. I expect the price to hit a lower low in the area of 97.10-96.50 before resuming the uptrend. Long-term support is provided by the Ichimoku cloud at 94-93. A breakout above 100.50 will be a huge bullish signal.The material has been provided by InstaForex Company - www.instaforex.com