EUR/USD turned lower Thursday and fell away from the daily cloud base as economic data kept alive worries about China and weakness in Germany, which could keep downside prospects alive.

Although China's August PMI came in above expectations it remained in contraction at 49.7 versus 49.3 in July and above estimates of 49.4.
The persistent contraction in manufacturing has fueled concerns that slower growth in China will hurt the euro area.

An unexpected fall in German July retail sales and a more than expected rise for August unemployment trumped the impact of August euro zone inflation data that could keep ECB rates hikes in play.

EUR/USD fell below the 10- and 21-day moving averages even after China's PBOC announced an adjustment to mortgage rates in an effort to revive the ailing property market.

EUR/USD's price action suggests investors see the prospect of slower growth as a key downside risk.

Technicals add to bearish risks.
Falling daily and monthly RSIs and the hold below the 55-DMA and daily cloud are bearish signs.

Should U.S. August employment data come in above estimates, EUR/USD could fall sharply.

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