USD/CAD is likely in corrective phase following its decline from its 1.0609 peak. Even though scope is still seen for a move higher back towards the key resistance at 1.0445 (07/08/2013), a lower high is sought in the 1.0400 region for a fresh leg lower to retest the 1.0246 low (01/08/2013). This would probably give way for a return to long term trend line support from 0.9633 (14/09/2012 low), close to the 200 day moving average, currently at 1.0161.
In the longer term, the key resistance at 1.0870 (02/11/2009 high, see also the long-term declining trendline from the October 2002 peak) is expected to cap the medium-term upside potential. However, as long as the support at 1.0137 (14/06/2013 low) holds, we would still favour a mild medium-term bullish bias.