Dollar Index trades in extended consolidation; US tax reforms plan seen as catalyst for fresh s/t direction
The dollar index stands at the back foot on Thursday and probes below 10SMA (currently at $94.63) which turned into sideways mode after tracking the ascend of past two weeks.
Firm break below 10SMA pivot would trigger further easing and expose key supports in $94.10 zone, which previously acted as key resistances (former tops of 16 Aug / 06 Oct / Fibo 38.2% of $92.57/$95.05 upleg.
The index is in short-term consolidative phase between $94.10 and $95.05, as broader bulls are taking a breather before resuming.
However, the dollar requires a catalyst to continue two-month uptrend from $90.97 which was so far capped by falling weekly Kijun-sen and Fibo 61.8% of $94.50/$90.97 downleg.
Focus is on US tax reforms plan, implementation of which has been delayed, with firmer signs of progress expected to boost the greenback.
Alternatively, further delay in implementation of the plan would risk deeper correction which could be sparked on firm break below $94.10 pivot.
Res: 94.85; 95.05; 95.27; 95.94
Sup: 94.41; 94.10; 93.81; 93.63