American swimmer Michael Phelps will compete in two events at the Canada Cup of swimming on July 2-3. ((Chuck Burton/Associated Press))

Michael Phelps says he's in the midst of a physical and mental rebuilding process but is determined to regain his performance level of the Beijing Games when he comes to Montreal in July.

The American swimmer, who turns 26 as he participates in two events at the Canada Cup of swimming on July 2-3, acknowledges he struggled to get motivated after winning gold in all eight races where he competed at the 2008 Olympics.

That's why he took a break before resuming serious training this year.

"I needed to step away and take some time for myself," he said.

"I was able to do that. It has been a slow process to get back to where I want to be."

But Phelps is satisified with the direction he's headed in, saying, "I'm happy, I'm working hard."

"I feel there's been a lot of improvement," he said. "I know the goals I have are extremely high and they're going to be extremely hard and difficult to achieve but they're something I want very bad and if I want something bad enough, I'm going to work as hard as I can to get there."

Phelps, who also won six gold and two bronze medals at the Athens Olympics in 2004, is now training at high altitude in Colorado Springs to bring his body to its maximum level of fitness.

He said he'll know by the end of the summer what his goals will be for the London Olympics and how he'll prepare for the Summer Games in 2012.

Phelps didn't see himself competing in eight events again at the Olympics but he said his regimen this summer will give him a good idea of what his body can handle.

He said he wants he wants to bring his body to a level that allows him to compete in as many events as possible and said that this summer he wants to be able to compete in the preliminaries, the semifinals and in the 100-metre and 200-metre relay.

The competition in Montreal, which will serve as preparation for the world championships that will follow from July 16 to July 31 in Shanghai, will be one of the early stages in Phelps' attack plan.

Phelps pointed out that competing in Montreal in 2009 helped him gain confidence to compete at the world championships.

Phelps has yet to confirm which events he will enroll in Montreal, but he is likely to contest the 200 freestyle and 100 butterfly.

Phelps acknowledged that the comeback of Ian Thorpe is an important motivator for him. The Australian has been a longtime inspiration to him — and rival.

He said he looks forward to facing Thorpe, whom he described as one of the best freestyle swimmers in history, in a duel that will likely happen in January 2012.

"I love to see a talented athlete return to competition," he said, adding he'll be interested to see what progress Thorpe makes over the next year.