The AUDUSD pair declined 0.3% during the EU session and traded near 0.7480 as the bullish momentum seems to be over.
During the Australian session, the domestic trade balance for February worsened notably to 7,457 million AUD, down from 11,786 million AUD in January. Exports declined from 6% to 0%, while imports rose to 12% from -2% previously.
Traders also took some profits after the big rally in the Australian dollar this week, following the recent monetary policy decision by the Australian central bank.
It looks like the recent rally could be over as the Aussie jumped into overbought territory, likely leading some investors to take profits. Additionally, the MACD indicator on the daily chart sent a bearish signal yesterday, probably helping to start a short-term correction.
The Aussie is about to test the short-term lows in the 0.74650 zone. Falling below that level could prompt more selling, likely dragging the Aussie to 0.7420 or possibly toward 0.7370.
On the other hand, the AUD must return above 0.7540 to change the short-term outlook back to bullish. In that case, we might see a quick rally toward the actual cycle highs near 0.7650.