$/Cad, at Base of 3 Month Pattern

No change in the view in $/cad as the market continues to form a large pennant/ triangle since the April low at .9935. As been discussing for quite some time, these are seen as continuation patterns, suggesting an eventual downside resolution (likely sharp). However, they break down into 5 waves leaving open scope for a final test of the ceiling first (currently at 1.0560/70, see "ideal" scenario in red on daily chart below). Still short from the July 1st resell at 1.0600, and with the market currently testing the base (currently at 1.0255/70) and risk of a final upleg to the ceiling, would use an aggressive stop on a close above the bearish trendline from July 20th (currently at 1.0370/80 and falling rapidly, but would keep you in the position if the market breaks down from here). Further support below there is seen at 1.0140/50 (June 21st low). Note, these are one of my favorite patterns. Despite the fact that there is little in the way of "net" change as they form, recognizing it early on and having a broad strategy of fading the extremes, can be very profitable (a number of smaller profits, which add up quickly - see last 5 trades since April on daily chart below).

Longer term, also no change as the view of an extended period of ranging (with a slight downward bias) within the bearish channel from last Aug remains in place. Note that the nearer term pennant is forming within the channel, and adds to the view of declines back to the April low at .9935, and even the base of the channel (currently at .9725/50). But note that this channel may be part of a year long bottoming process and raises the risk that new lows below .9935 may be short-lived (see "ideal" scenario in red on weekly chart/2nd chart below). Switched the longer term bias to the bearish side on Fed 12th at 1.0525, but will be looking for signs of a more important bottom on an approach (and especially break) of the April low at .9935 (if that does indeed occur).