- WTI drifts lower amid reviving hopes for the resumption of US-Iran peace negotiations
- Supply risks stemming from conflicts between Houthis and Saudi Arabia help limit losses.
- The constructive technical setup further warrants caution for aggressive bearish traders.
West Texas Intermediate (WTI) – the benchmark US Crude Oil price – slides to mid-100.00s during the Asian session on Thursday, though the downside potential seems limited amid uncertainties surrounding the Middle East crisis.
In the latest developments, regional mediators led by Qatar are working to restart US-Iran negotiations to prevent the resumption of the war. Separately, US Vice President JD Vance reportedly sent a letter to Mohsen Rezaei, secretary of Iran’s Supreme National Security Council, in an effort to revive peace talks. This, in turn, exerts some pressure on crude oil prices.
However, the fighting between the Iran-backed Houthis and the Saudi Arabia-backed government in Yemen keeps the geopolitical risk premium in play. Moreover, The Wall Street Journal reported on Tuesday that US officials have told several Gulf Arab countries to prepare for a short and intense military campaign against Iran after the November 3 midterm elections.
This, in turn, might hold back bearish traders from placing aggressive bets on crude oil prices and limit the downside. Even from a technical perspective, the black liquid retains a mildly bullish near-term bias above the 23.6% Fibonacci retracement at $99.33 and the 100-period Simple Moving Average (SMA) on the 4-hour chart, currently pegged near the $96.20 area.
Meanwhile, the Relative Strength Index (RSI) reading around 50 suggests neutral momentum and a consolidative tone. Furthermore, the Moving Average Convergence Divergence (MACD) indicator remains slightly negative, hinting that upside progress could be gradual rather than impulsive, but price action above the key structural levels keeps the bias on the upside for now.
Hence, a break below the 23.6% retracement could find support near the clustered Fibonacci region between $96.85 and the 100-period SMA at $96.20, and then the deeper retracement floors at $94.85 and $92.84. On the topside, the next significant hurdle aligns with the Fibonacci anchor high at $103.34, where a clear break would open the way for a stronger bullish extension.
