By laksh5382 
The dollar index remained around the important support level of 105.50 throughout the last week. The index fell below this support but did not hold. The decline was short-lived after the jobs data was released on Friday. The index hit a low of 105.42 soon after the data was released, but then rose back from there to close the week at 106.05.
job number
The US added 227,000 jobs to its non-farm payrolls in November. The payroll number was above market expectations of an increase of 214,000.
The unemployment rate increased to 4.2 percent in November from 4.1 percent a month earlier. There will be a need to keep a close eye on this data in the coming months. If this change continues, there is a danger of the unemployment rate increasing further in the coming months.
At present, the market expects the US Federal Reserve to cut interest rates by 25 basis points in its meeting on December 18 this month.
dollar outlook
Dollar Index (106.05) is managing to stay above 105.50. The near-term outlook is a bit unclear. A sustained rise above 107 is needed to regain momentum. If this happens then the dollar index may cross 108 and reach 110-111 in a month or two.
If the index falls below 105.50, it may test 105 initially. Another break below 105 could drag it down to 104. Only a strong decline below 104 would turn the outlook completely bearish.
poor yield
The US 10-year Treasury yield (4.15 per cent) is struggling to rise above 4.25 per cent. The picture for the near future is weak. The yield may fall to 4.05 percent or 4 percent in the coming days. As a result, the dollar index may remain weak in the near term.
To pave the way for a rise to 4.5 percent, the 10-year Treasury yield would have to rise above 4.25 percent.
space to rise
Euro (EURUSD: 1.0568) is finding support around 1.0470. There is a good chance of seeing a rise to 1.07-1.0720 in the near term. But there will be a need to keep a close eye on the price action after this increase. Failure to get a strong follow-up rise above 1.0720 could drag the euro lower again. That reversal could take the currency down to 1.05-1.04 again.
near term support
The Indian Rupee (USDINR) fell sharply last week after the release of weak GDP data. The domestic currency fell to a new low of 84.76 and recovered slightly from there.
The broader picture is weak. However, short-term support lies in the 84.80-84.85 area which may limit the downside for now. Some improvement may be seen in rupee till 84.50. However, a move beyond 84.50 may be difficult now. Broadly speaking we can see a range of 84.50-84.85 for some time now.
Ultimately we expect the rupee to break 84.85 and fall to 85 and below in the coming weeks.
trading range
Rupee may remain in the range of 84.50-84.85 for some time before weakening further