USD/CAD trades in red near 1.3150 as WTI adds more than 2% on Monday

• Barrel of West Texas Intermediate rises more than 2% on Monday.
• Commodity-related Loonie capitalizes on upbeat sentiment and oil rally.
• US Dollar Index stays calm near 98.20 handle.

The USD/CAD pair fell to its lowest level since late July at 1.3146 on Monday as the rising crude oil prices continued to help the commodity-related Loonie outperform its rivals. As of writing, the pair was down 0.14% on a daily basis at 1.3158. 

Upbeat sentiment supports crude oil rally

Rising hopes of Chinese economy picking up momentum amid expectations of additional stimulus going into the economy and easing fears over a dismal energy demand outlook provided a boost to crude oil prices at the start of the new week.

Chinese President Xi Jinping today said that they will continue to support the development of private firms and Chinese news outlet Global Times reported that China's Central Bank was expected to make another rate cut to its reserve requirement ratio (RRR) before the end of the year. As of writing, the barrel of West Texas ıntermediate was up 2.3% on the day at $57.90. 

On the other hand, the US Dollar Index, which closed the previous week in the negative territory, staged a technical correction on Monda and is now up 0.25% on the day at 98.25, helping the pair limit its losses for the time being.

There won't be any significant macroeconomic data releases in the remainder of the day and crude oil prices are likely to continue to drive the pair's price action. In fact, Canadian economic docket won't feature any high-tier data this week and the inflation data from the US on Thursday will be the only high-impact data of the week.

Technical levels to watch for