EUR/USD: where next, 1.2335?

• EUR/USD tested below 1.2400.
• EUR/USD headed for a break to 1.2335?

EUR/USD is lower and testing below the 10-D SMA at 1.2408 while the greenback catches a bid from a low of 89.021 and scoring a high of 89.614.  Currently, EUR/USD is trading at 1.2416, down -0.36% on the day, having posted a daily high at 1.2475 and low at 1.2393.

The euro has been unable to capitalize on the impressive PMI data from the European session or a hawkish Draghi and instead, the dollar bulls have enjoyed domestic ISM data that arrived with a record high employment index factor - (ECB's Draghi warned of inflationary headwinds and euro volatility).

DXY firmer while Wall Street takes a plunge

The greenback has firmed on the data and liquidation of investments in its counterparts across the board, apart from the yen. The yen has caught a safe haven flow bid with heavy losses on Wall Street. The Dow has made a low of 23757.30 and the S&P made a low of 2635.28 in today's session. The cross EUR/JPY is now below 136.40 subsequent to the poor performance in equities and is supporting the EUR/USD bid closing just below the 200-hour SMA.

EUR/USD trades within a bullish trend and bulls are building up for a break of the consolidation period. the long-term Fibonacci resistance at 1.2517/1.2600 is key while otherwise, a failure to break higher opens risk towards 1.2335 and the January 18 low at 1.2165. A break there opens risk to the August and September highs at 1.2092/70