WTI consolidates around $86.00; bulls potential intact amid US-Iran impasse
West Texas Intermediate (WTI) – the benchmark US Crude Oil price – oscillates in a range around the $86.00 mark during the Asian session on Friday and remains well within striking distance of a three-week high, touched the previous day. The black liquid seems poised to register gains for the second consecutive week and build on a two-week-old uptrend amid a supportive fundamental backdrop.
The US and Iran remain at loggerheads over restoring safe commercial navigation through the strategic Strait of Hormuz, fueling supply concerns and acting as a tailwind for crude oil prices. Adding to this, Yemen’s Iran-backed Houthi militant group claimed to have targeted eight Saudi oil tankers since late July, when it declared a maritime blockade on Saudi shipping, raising the risk of a broader regional conflict.
Meanwhile, President Donald Trump said the US will launch the most crushing economic operation against Iran and threatened severe penalties on any nation that helps Tehran evade sanctions or does business with Iran. Moreover, Vice President JD Vance said that economic pressure is the most effective tool against Iran. This keeps the geopolitical risk premium in play and validates the positive outlook for oil prices.
Bulls, however, seem hesitant to place fresh bets and opt to wait for fresh developments surrounding the Middle East crisis. The broader fundamental backdrop, however, suggests that the path of least resistance for the commodity remains to the upside. Hence, any corrective pullback is more likely to be bought into and remain limited.
WTI 4-hour chart
Technical Analysis
WTI keeps a constructive bullish tone above the 61.8% Fibonacci retracement of the July-August slide and the 200-period Exponential Moving Average (EMA). The cluster of underlying Fibonacci supports between $85.02 and $80.65 suggests the recent advance is underpinned by a solid structural base, with buyers retaining control while price stays north of these levels.
On the topside, immediate resistance aligns at the 78.6% Fibo. retracement at $88.14, ahead of the recent swing-high region at $92.11. On the downside, initial support is seen at the reclaimed 61.8% retracement at $85.02, followed by the 50% level at $82.84 and the 200-period EMA at $81.28, with deeper floors at the 38.2% retracement at $80.65 and lower Fibonacci anchors at $77.94 and $73.56.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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