US Dollar Index forecast for the week of December 3, 2012, Technical Analysis

The US Dollar Index initially rose for the week, and even managed Pierce the 80.50 level. However, by the end of the Friday session we solve this market lose value slightly, and form a shooting star. This shooting star is just above the 80 handle, which we have as a significant support level. Because of this, we think that this market is going to give us a fairly strong signal in the short-term.

If we managed to break down below the 80 handle on a daily close, we think that is good enough for a signal to short and aim for at least 79. However, if we managed to break the top of the shooting star for this previous week, we think that 81.50 would be a reasonable target, and realistically we could even see as high as 84. In the meantime, we are sitting on the sidelines waiting to see which side of this candle the market breaks out of.