USD/CAD: Bulls are hoping a rebound as oil prices nosedive below $100.00

• USD/CAD is oscillating around 1.2830 but is likely to rebound amid falling oil prices.
• The DXY is drifted near 98.87 on rising uncertainty over the interest rate decision by the Fed.
• Apart from the Fed’s monetary policy, Canada's CPI numbers are also due on Wednesday.

The USD/CAD is oscillating in a narrow range of 1.2818-1.2827 on Tuesday but is likely to witness a fresh impulsive wave amid falling oil prices. The oil prices have plunged below the $100.00 mark, trading around $96.72, at the press time.

West Texas Intermediate (WTI) prices have witnessed an intensified selling from March 8 high at $126.51 after the OPEC cartel promised to be determined towards fixing the gap in the demand-supply mechanism. The OPEC promised to pump more oil into the total global supply after the US imposed sanctions on Russia post its invasion of Ukraine and other Western leaders decided to lower their dependency on Russian oil imports gradually. Apart from that, the Iran nuclear deal is likely to be released from sanctions as the think tank is looking for Russian oil substitutes aggressively.

Meanwhile, the US dollar index (DXY) has drifted below 99.00 ahead of the interest rate decision by the Federal Reserve. Investors are eyeing the extent of a rate hike by the Fed’s Chair Jerome Powell and stance over the monetary policies later this year. Fewer headlines from the Russia-Ukraine war have also brought some offers in the DXY and it slipped near 98.87, at the time of writing.  

Although the headlines from the Russia-Ukraine war and the monetary policy dictation from the Fed will remain the major driver for the asset, investors will also focus on Canada’s Consumer Price Index (CPI) data, which is due on Wednesday. A preliminary estimate of Canada CPI numbers is 4.8%, higher than the prior figure of 4.3%.