USDCAD bases above key retracement and 20-month moving average; Buy on dips

USDCAD stabilized at 1.0618 (July 3 low) which is just above the rising 20 month moving average and near 61.8% of the 1.0182/1.1280 up-move (see monthly/weekly chart), signaling basing. 

On the daily chart, the recent rebound off the double bottom (1.0618/1.0626) breaks above the 4-month falling trendline (red line), signaling more bullish momentum ahead. The improving indicators confirm the view.

On the 240minute chart, the pair broke out of a bullish triangle pattern, looking to test 1.0795 near the 50 day moving average (aqua line, daily chart). Above there lies resistance cluster including the prior swing lows at 1.0813/1.0819, 200 day MA at 1.0829 and 61.8% of the 1.0962/1.0618 fall. An extension through there would target 1.0890 near 76.4% retracement.

On a pullback, the 1.0790 zone should support dips (i.e., where stops for long trade should be). Below there would shift the focus back to the 1.0618/1.0626 basing zone. A clean breakdown there would signal topping under the 200 day MA and resume the downtrend off March 2014 peak towards 1.0182.

Trading bias:

Short term: 

Buy zone around 1.0740-1.0750

Stop below 1.0709

Target near 1.0825 - 1.0890

Long-term:

Buy zone around 1.0700

Stop below 1.0618

Target near 1.1054

USDCAD monthly chart

 USDCAD weekly chart

 USDCAD daily chart

 USDCAD 240min chart