FXStreet (Mumbai) - The EUR/USD pair finally broke the consolidative phase seen ahead of the European open, and fell sharply lower to hit fresh daily lows, before recovering slightly to 1.0865 region. EUR/USD tests 1.0850 on poor German data Currently, the EUR/USD pair trades 0.61% lower at 1.0864, moving away from fresh session lows struck at 1.0855 last minutes. The EUR smashing extends further in Europe, with the European traders hitting their desks amid a generalized risk-on environment after the Chinese stock halted the carnage and embarked on a recovery mode. Moreover, reports that the Euro zone’s money markets are pricing-in a ECB March rate cut, as reflected by the forward EONIA, combined with the latest comments by ECB’s Philip Lane adds to further downside in the major. Adding to the downbeat sentiment on the EUR, a set of German macro data released earlier on the day disappointed markets. Germany’s industrial output decreased 0.3% in the Nov, after reporting a 0.5% growth seen in Oct. While the country’s trade surplus shrank in Nov to €20.6 billion versus €22.3 billion previous. Focus now shifts towards the NY session, with the much-awaited US payrolls data on tap. The US labour market conditions and the inflation outlook remain the two key parameters for the Fed to assess further rate increases going forward. EUR/USD Technical Levels In terms of technicals, the pair finds the immediate resistance is seen at 1.0940/42 (daily high/ hourly R2). A break beyond the last, doors will open for a test of 1.0984 (100-DMA). On the flip side, the immediate support is placed at 1.0814/11 (1h 100 & 50-SMA), below which 1.0769 (Jan 7 Low) could be tested. For more information, read our latest forex news.