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Stocks trade higher, and the S&P Futures at new highs around 1267 on optimism that European leaders will approve aggressive plans by the end of the week to rescue the region from a debt crisis.

Meanwhile, majors found some support against the US dollar, but moves were really poor with some low volume and momentum. We, however, expect further dollar weakness, especially as recovery shown on dollar index appears corrective from Nov 30, labeled as wave X, but still not sure if finished already.

With this being said, we need consider more choppy and slow price action on Eur/Usd, Gbp/Usd, Aud/Usd and others as well.

Dollar Index chart:

US Dollar Index Elliott Wave Analysis December 7 2011

Guest post by Gregor Horvat

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With further strength on stocks, we still believe that Australian dollar will improve, despite a cut from the RBA two days back.

You can also check the video below in which Grega Horvat will present a detailed technical analysis for Eur/Aud and Gbp/Aud that  was shared with his subscribers but now also available to you!