US Dollar Index (DX) Futures Technical Analysis – November 9, 2015 Forecast

December U.S. Dollar Index futures are trading lower shortly before the cash market opening. The inability to follow-through to the upside, following Friday’s strong surge suggests investor indecision and impending volatility. It also suggests that Friday’s strong surge was likely triggered by buy stops rather than aggressive buying. This could lead to a break back into support.

If investors really feel the dollar is headed higher, then they are likely to come in on a pullback into support. The first potential target is the long-term Fibonacci level at 98.78. If this fails then the next support is a steep uptrending angle from the 93.83 main bottom. This angle has guided the market higher or 16 sessions so a failure to hold it will indicate a major shift in investor sentiment.

The next target under the angle at 98.08 is the major 50% level at 97.65.

A sustained move over last week’s high at 99.47 will indicate that buyers have returned. If they come in strong enough to sustain the move then this may create enough upside momentum to eventually reach the April 13 main bottom at 101.19.

The current price is 98.99. This puts the Dollar Index in a position to test the Fibonacci level at 98.78 right on the regular session opening. Trader reaction to a test of this level will tell us whether the bulls or the bears are in control.

The market may straddle the Fib level the rest of the week until the U.S. retail sales report is released on Friday.