• WTI attracts some buyers for the second consecutive day, though the upside remains capped.
• The US-Iran standoff keeps the geopolitical risk premium in play and supports the commodity.
• Traders also seem hesitant and opt to wait on the sidelines ahead of the crucial US NFP report.

West Texas Intermediate (WTI) – the benchmark US Crude Oil price – gains positive traction for the second straight day on Friday, extending its recovery from the $86.00 mark, or an over two-month low, touched the previous day. The commodity, however, lacks bullish conviction and currently trades just above the $90.00 psychological mark, up around 0.50% for the day, amid geopolitical uncertainties.

President Donald Trump said on Thursday that the US may have to destroy the rest of Iran and added that people will know soon enough if he acts. Moreover, the US and Iran remain divided over Tehran’s nuclear program. In fact, Trump stated that Iran cannot do anything pertaining to its nuclear program without approval from the US. Moreover, threats to commercial traffic persist despite a recovery in crude shipments through the Strait of Hormuz. This keeps the geopolitical risk premium in play and acts as a tailwind for crude oil prices.

Meanwhile, a Democratic sweep in the US midterm elections lowered expectations that US President Donald Trump will resume military strikes against Iran. In fact, top Senate Democrat Chuck Schumer vowed on Wednesday to push for an end to the Iran war and said that his party could use control over government funding to press for that goal. This keeps hopes alive for a diplomatic resolution to end an eight-month-old US-Iran war, which might hold back bulls from placing aggressive bets and cap any meaningful upside for crude oil prices.

Nevertheless, the commodity remains on track to register heavy weekly losses of around 12% and remains at the mercy of further developments surrounding the Middle East crisis. Apart from this, the popularly known US Nonfarm Payrolls (NFP) report, due later during the North American session, could infuse some volatility in the financial markets and produce short-term trading opportunities around the black liquid.

WTI daily chart

Technical Analysis

WTI holds a constructive near-term bias above the 200-day Simple Moving Average (SMA) at $86.10 and has recently pushed through the 38.2% Fibonacci retracement of the broader upswing at $89.88, turning that area into immediate underlying demand. The next resistance aligns at the 23.6% Fibo. level at $95.31, ahead of the cycle high anchor around $104.09, which represents a more distant bullish objective.

On the downside, initial support is seen at the $89.88 zone marked by the 38.2% Fibo. retracement, followed by the 200-day SMA and nearby 50% retracement cluster in the $86.10–$85.49 band, where buyers would be expected to re-emerge on a deeper pullback.