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  • AUD/USD sold-off into risk-aversion, S&P 500 futures’ slide.
  • US Presidential election debate rescues the US dollar bulls.
  • Aussie ignores mixed Chinese PMIs ahead of key US data.

AUD/USD is extending losses in early Europe, following a rejection at five-day highs of 0.7150, as risk-aversion remains at full steam in the aftermath of the first US Presidential election debate.

The election debate between President Donald Trump and opposition candidate Joe Biden was not a market mover. Although Trump’s warning about the delay in the election results raised doubts about a ‘peaceful transition’, with the odds for a Biden win on the rise, spooked markets and lifted the demand for the US dollar across the higher-yielding assets.

The US stock futures quickly shaved-off gains and slipped nearly 50-points while the higher-yielding aussie dollar also followed suit. At the time of writing, AUD/USD sheds 0.25% to trade at 0.7110, having tested the 0.7100 support.

The $10 sell-off in gold also collaborated with the downtick in the resource-linked aussie. Meanwhile, the bulls were offered little reprieve from the expansion in the Chinese Manufacturing PMIs released by Caixin and NBS.

Looking ahead, the US dollar dynamics and global market sentiment will have a strong bearing on the risk-sensitive AUD pair, with eyes on the US ADP jobs, GDP and personal consumption data.

AUD/USD Technical levels

Any pullbacks are likely to meet fresh supply once at 0.7150, above which the September 23 high of 0.7179 will be put to test. To the downside, the immediate cushion is seen at 0.7076 (5-DMA) below which the sellers will target the 100-DMA at 0.7025.

AUD/USD Additional levels