FX.co ★ USDX technical analysis for December 2, 2015

The US dollar index has broken down the rising wedge, and we can see a correction beginning. I have warned bulls that they should be cautious and raise their protective stops. With NFP on Friday and with the ECB press conference scheduled for tomorrow, this week is very possible to be very volatile.

Blue lines - bullish channel

Red lines - bearish divergence

In the 4-hour chart above we can see that the US dollar index has broken down the bullish channel. However, the price still holds above the Ichimoku cloud. Short-term resistance is seen at 100.17, while the index is now trading at 99.85. Support is found at 99.60 and at 99.45.

In the weekly chart above we can see that the index has reached the previous highs and shows signs of rejection and reversal. The weekly stochastic is oversold but has not yet generated a sell signal. It has only given us a warning that there are increased chances of a reversal. Weekly support is found at 99 and below that level we will find support at 98.