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  • AUD/USD defies Friday’s downbeat daily performance while taking rounds to seven-week high.
  • Risks benefit from hopes of further stimulus as Joe Biden wins US elections.
  • Virus woes probe the bulls amid a light calendar.

AUD/USD takes the bids near 0.7280, up 0.30% on a day, during Monday’s Asian session. The aussie pair surged to the highest since September 21 earlier in the day before declining to 0.7267. Bulls keep the reins as the coronavirus (COVID-19) worries confront market optimism following the US presidential elections.

With Democratic Party’s representative Joe Biden’s victory in the US elections, global equity traders anticipate fewer hurdles for the easy money policies for which Democrats are famous. However, Donald Trump keeps challenging the final verdict, citing mischief in ballot counting, while trying to block Biden’s way to the White House.

Not only the decision on whether the Republican will keep the Senate majority but the COVID-19 woes also challenge the AUD/USD buyers. The latest tally from Reuters suggests that there are over 10 million covid cases in the US, needless to mention about 30 million infections in Europe.

With the virus vaccine still out of the sight, pandemic wave 2.0 is likely to weigh on the global economy as major growth engines are shut in the bloc to tame the virus.

On the positive side, policymakers from the European Union (EU) and the UK are trying to close the trade deal, despite major differences, ahead of the next week’s key EU summit.

Amid all these plays, ASX 200 probes the highest since March 2020 while S&P 500 Futures also join the bullish move with over 1.0% gains by press time.

Looking forward, a lack of major data/events can help the global markets cheer US election results for some more time, which in-turn can please the AUD/USD buyers. However, any surprise announcements from US politics may change the mood and hence should be watched carefully.

Technical analysis

Unless declining below an upward sloping trend line from September 22, at 0.7262 now, bulls can keep the mid-September tops near 0.7345/50 on the radar. Though, a clear break above the 0.7300 threshold becomes necessary for that.