By Tom Dyson in Penny Trends:

So what are the big trends you need to know about this week?

The dollar is one. The U.S. dollar is probably the most important financial instrument in the world. It's the cornerstone of the entire global financial system. When the dollar moves, you get major reactions in other markets.

Here's a chart of the U.S. Dollar Index, an index of the dollar's value measured against a basket of the major currencies like the euro, the yen, and the pound.

 

As you can see, the dollar has been sliding lower for most of the year. By the end of November, the dollar had fallen more than 17% from its March high. This is one of the seven worst declines in the dollar of the last two decades.

Over the past three weeks, the dollar has rallied. It's the strongest bounce we've had in six months. Notice the Relative Strength Index (RSI) reading at the bottom of the chart. It's been rising, even while the dollar has been falling. This is a bullish development. It suggests the dollar is healthy on the inside, and a major turning point is in the works...

Crux Note: Penny Trends is S&A's weekly trading research service which looks exclusively for big trends in tiny stocks - with the potential to quickly return at least 100% or more. Editor Tom Dyson say it's still too early to make a big trade on the dollar, but he's ready to pull the trigger as soon as the trend is confirmed. To learn more about this exclusive service, click here.

More on the dollar:

Forget about inflation and a dollar crisis

Jim Rogers is loading up on the U.S. dollar

Dollar rally starting: A big headwind for stocks