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USD/CAD - Look Out for a Meaningful Bearish Correction

The USD/CAD has been in a bullish market since at least September 2012, where it rallied from 0.9632 to the 2014 high of 1.1277. You can even argue that the trend started from the 2011-low of 0.9405. Refer to the weekly chart: 

(usdcad weekly chart, 5/6)

Topping, Bearish Correction
However, the price action in 2014 has established a top and is suggesting a meaningful bearish correction. The bearish correction has already been developing for over a month now, but there is bearish momentum, and room for further dip.

Bearish Projection:
On the daily chart, we can project another bearish swing using the previous one, and it would target the area around 1.0640. 

(usdcad daily chart, 5/6)

Support factors:
The daily chart shows us some support factors that might challenge the bearish correction outlook.

1) 1.0855-60 is the support traders will be dealing with in the upcoming session. With the stochastic and RSI showing oversold condition in the daily chart, we should anticipate some support soon. A break below 1.0855 should be treated with caution because of a rising trendline immediately below.  

2) There is a rising trendline from Sept. 2013 that will likely also challenge any bearish breakout scenario arising from the break below 1.0855.

3) The 200-day SMA is around 1.0750. I think this is a viable target in the medium-term. Although it would have cracked a rising trendline from September, the multi-year bullish trend remains intact.

4) 1.0730-1.0740 was also a resistance area from late 2013, which can turn into support

5) Near the swing projection noted before, the 38.2% retracement level will be at 1.0650. This is 38.2% of the Sept. 2012 - Apr.2014 rally from 0.9623 to 1.1277.

6) If you look back at the weekly chart, the 1.06-1.0650 area was a major resistance pivot that might turn into support. 

In conclusion, USD/CAD looks like it is developing a bearish outlook for the weeks ahead, but it would still be within the context of a mult-year bullish trend