USD/CAD's recovery from 0.9891 extended to 1.0301 but momentum remained unconvincing. Also, the choppy look of such recovery suggested it's corrective in nature. Hence, while further rise could still be seen with 1.0087 minor support intact, we'd expect upside to be limited by 61.8% retracement of 1.0656 to 0.9891 at 1.0364 to finish the correction. Below 1.0087 will indicate that such correction is already completed and will flip bias back to the downside for 0.9891 support and below.

In the bigger picture, price actions from 0.9406 are viewed as corrective in nature, which would eventually develop into a consolidation pattern. The first leg should have completed at 1.0656. The second leg form 1.0656 might spiral down towards 0.9406 or gyrate sideway between 0.9725 and 1.0656. But after all, firstly, down trend from 1.3063 is expected to resume eventually for another low below 0.9406. Secondly, while another strong rally might be seen as the consolidation extends, upside should be limited by 38.2% retracement of 1.3063 to 0.9406 at 1.0803 to finish the consolidation.

In the longer term picture, there is no clear indication that the long term down trend from 2002 high of 1.6196 has reversed even though bullish convergence condition was seen in monthly MACD. The strong resistance ahead of the falling 55 months EMA suggests that decline from 1.3063 might still be in progress and a break of 0.9406 will possibly extend the down trend through 0.9056 low.

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