EUR/USD: Eurozone PMIs will test Euro's resilience

• EUR/USD ekes out gains on coronavirus vaccine optimism. 
• The pair is up over 1% this quarter despite renewed virus criss across the Eurozone. 
• Euro's resilience may end if Eurozone PMIs due on Monday miss expectations.

EUR/USD has shown uncanny resilience to adverse developments across the Eurozone over the past few weeks. The common currency's ability to stay bid will be tested on Monday as a survey-based indicator is set to reveal the true extent of damage to the economy caused by the resurgence of coronavirus. 

"We'll get a good look at that [impact on the economy] with Eurozone PMIs, confidence, and the German IFO report," BK Asset Management's Kathy Lien noted while adding that weak data could cement the top for euro. 

While Germany's Markit Manufacturing PMI for November is expected to have dropped to 56.5 in November from October's 58.2, the aggregate reading for Eurozone is seen falling to 53.1 from 54.8. 

A big miss on expectations would imply that covid-19's resurgence is taking a toll on the Eurozone economy and force investors to reassess their judgment that the currency bloc's recovery is leading that of the US. As such, the EUR will likely drop on weak data. 

Alternatively, investors may scale back dovish European Central Bank expectations if the PMIs beat estimates, leading to a notable upside move in the common currency. 

The EUR/USD pair is currently trading at 1.1873, representing over 0.10% gains on the day. The optimism emanating from prospects of an early launch of coronavirus vaccines and the uptick in stocks helps the EUR move higher. 

The pair has gained 1.3% so far in this quarter even though Eurozone's economic powerhouses such as Germany and France have reimposed economically-painful lockdown restrictions. According to Lien, euro's resilience is due to the general view that the US is a few weeks behind the Eurozone 

Technical levels