USD/CAD edged lower to 0.9406 but formed a short term bottom there and rebounded. Initial bias is mildly on the upside for stronger rise towards near term falling trend line (now at 0.9614) and possibly above. But after all, break of 0.9778 is needed to signal reversal in recent down trend. Otherwise, we'd still favor further decline ahead. Below 0.9497 minor support will flip bias back to the downside for retesting 0.9406 first. Break will confirm down trend resumption for 61.8% projection of 1.0671 to 0.9444 from 0.9912 at 0.9154.

In the bigger picture, medium term outlook in USD/CAD remains bearish and the down trend from 2009 high of 1.3063 is expected to continue lower. Nevertheless, even in that case, we'd again start to look for reversal signal as USD/CAD approaches 0.9056 key support (2007 low). On the upside, however, break of 0.9912 will be a signal that 0.9406 is the medium term bottom already and should turn outlook bullish for a test on 1.0851 key resistance next.

In the longer term picture, firstly, there is no clear indication that the long term down trend from 2002 high of 1.6196 has reversed. Secondly, the medium term fall from 1.3063 is so far looking corrective. Hence, we're slightly favoring the case that price actions from 0.9056 are developing into a long term corrective pattern.

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