US Dollar Index (DX) Futures Technical Analysis – December 9, 2016 Forecast

December U.S. Dollar Index futures are trading higher on Friday. The move is essentially a follow-through rally, following yesterday’s major reversal to the upside.

Technical Analysis

The main trend is down according to the daily swing chart. However, momentum shifted to the upside on Thursday when the index formed a closing price reversal bottom. Overtaking 101.275 earlier today helped confirm the potentially bullish chart pattern.

The short-term range is 102.120 to 99.49. Its 50% level is 100.995. This price is controlling the short-direction.

Holding above 100.995 will give the index an upside bias with the next target the 101.88 main top. This is followed by the next main top t 102.120.

Forecast

Based on the current price at 101.565, look for a strong upside bias as long as the market remains above the pair of angles at 101.433 to 101.405.

A sustained move over 101.433 will indicate the presence of buyers. This could create the upside momentum to challenge the downtrending angle at 101.776. The market will keep getting stronger if buyers can overcome this angle, followed by main tops at 101.880 and 102.120.

A sustained move under 101.405 will signal the presence of sellers. The next target is 100.995. Taking out this pivot will put the index in a weak position.

Look for a bullish tone today on a sustained move over 101.433 and a bearish tone to develop on a sustained move under 101.405. The market will especially turn weak if 100.995 fails.