FX.co ★ Daily analysis of USDX for December 20, 2013

Daily chart: USDX continues to rise and it seems that it is forming a lower high pattern below the 80.62 level. There are currently bearish patterns in this chart, as it is very likely that USDX will attempt to climb up the 200 SMA, which is situated near the 81.05 level. However, if USDX makes a bearish rebound at this resistance level, it is likely to resume the higher low pattern formation to try to drop below the 80.11 level. The MACD indicator is in positive territory.

H4 chart: USDX is forming a bullish pattern below the resistance level at 80.65, but we should be cautious of a possible breakout at that level, because USDX formed a fractal there, which could indicate a turnaround in this chart. If USDX manages to break the support level of 80.45, it is expected to fall to the level of 80.09. The MACD indicator is entering extremely overbought zone.

H1 chart: USDX has been consolidating in the range between the 80.73 and 80.59 levels. If USDX manages to break the resistance level of 80.73, it is expected to rise to the level of 80.93. On the other hand, if USDX makes a bearish rebound at the current levels, it will be expected to fall to the level of 80.35, so USDX will stay near the 200 SMA. The MACD indicator is still in negative territory.

Trading recommendations for today: Based on the H1 chart, place buy (long) orders only if the US Dollar Index breaks a bullish candlestick; the resistance level is at 80.73, take profit is at 80.93, and stop loss is at 80.52.